1. Explain the importance of working capital in terms of liquidity and short-term solvency position of a firm. 2. What do you understand from working capital? What are its different forms? 3. Net working capital is much useful in taking decisions', do you agree with the statement? Comment and justify. 4. "Working capital is two-edged sword, its excessive and deficit availability are equally bad". Comment and justify your answer with appropriate examples. 5. What are the different factors affecting the requirements of working capital?
Cost of Debt, Cost of Preferred Stock
This article deals with the estimation of the value of capital and its components. we'll find out how to estimate the value of debt, the value of preferred shares , and therefore the cost of common shares . we will also determine the way to compute the load of every cost of the capital component then they're going to estimate the general cost of capital. The cost of capital refers to the return rate that an organization gives to its investors. If an organization doesn’t provide enough return, economic process will decrease the costs of their stock and bonds to revive the balance. A firm’s long-run and short-run financial decisions are linked to every other by the assistance of the firm’s cost of capital.
Cost of Common Stock
Common stock is a type of security/instrument issued to Equity shareholders of the Company. These are commonly known as equity shares in India. It is also called ‘Common equity
Step by step
Solved in 4 steps