TAILIEUCHUNG - Lecture Contemporary financial management (9th Edition): Chapter 13 - Moyer, McGuigan, Kretlow

Chapter 13 - Capital structure management in practice. This chapter focuses on tools of analysis that can assist managers in making capital structure decisions that will lead to a maximization of shareholder wealth. It develops techniques, derived from accounting data, for measuring operating and financial leverage. | 13 Capital Structure Management in Practice Introduction This chapter focuses on tools of analysis that can assist managers in making capital structure decisions that will lead to a maximization of shareholder wealth. It develops techniques, derived from accounting data, for measuring operating and financial leverage. Operating and Financial Leverage Leverage A firm’s use of assets and liabilities having fixed costs in an attempt to increase potential returns to stockholders Operating leverage The use of assets having fixed costs Financial leverage The use of liabilities (and preferred stock) having fixed costs Various Categories of Costs From fixed operating or fixed capital costs Operating costs Costs of sales General, administrative, and selling expenses Capital costs Interest charges Preferred dividends Income taxes Short-Run Costs Over the short run, certain operating costs within a firm vary directly with the level of sales whereas other costs remain constant, regardless of changes in the sales level. Costs that move in close relationship to changes in sales are called variable costs. Short-Run Costs Variable costs are tied to the number of units produced and sold by the firm, rather than to the passage of time. They include raw material and direct labor costs, as well as sales commissions. Short-Run Costs Over the short run, certain other operating costs are independent of sales or output levels. These, termed fixed costs, are primarily related to the passage of time. Depreciation on property, plant, and equipment; rent; insurance; lighting and heating bills; property taxes; and the salaries of management are all usually considered fixed costs. Short-Run Costs If a firm expects to keep functioning, it must continue to pay these fixed costs, regardless of the sales level. Short-Run Costs A third category, semivariable costs, can also be considered. Semivariable costs are costs that increase in a stepwise manner as output is increased. One cost that sometimes

• Quản trị kinh doanh
• Financial mnagement
• Contemporary financial management
• Quản lý tài chính
• Quản lý tài chính hiện đại
• Lecture Contemporary financial management
• Capital structure management
• International financial marketplace
• Financial performance
• Business organizations
• Time value of money
• Analysis of risk
• Long term debt
• Preferred stock
• Common stock
• Capital budgeting
• Cost of capital
• Capital structure
• Dividend policy
• Financing with derivatives