Capital structure

1. CAPITAL
STRUCTURE
Here is where your presentation begins

2. What Capital Structure?
Capital structure is the specific
mix of debt and equity that a
company uses to finance its
operations and growth.

5. Debt
Debt consists of borrowed
money that must be repaid,
often with interest, while equity
represents ownership stakes in
the company.

6. The debt-to-
equity
(D/E) ratio is useful in
determining the riskiness of
a company's borrowing
practices.

8. Capital structure
can be a mixture of:
 company's long-term debt
 short-term debt
 common stock
 preferred stock

10. Debt is one of the two main
ways a company can raise
money in the capital
markets.

11. Companies benefit
from debt
 Interest payments
 Debt also allows a company or
business to retain ownership, unlike
equity.
 Additionally, in times of low-interest
rates, debt is abundant and easy to
access.

12.  Equity allows outside investors
to take partial ownership of the
company.
 Equity is more expensive than
debt, especially when interest
rates are low.

13. A long-term
investment
A long-term investment is an
account on the asset side of a
company's balance sheet that
represents the company's
investments, including stocks,
bonds, real estate, and cash.
Long-term investments are
assets that a company intends
to hold for more than a year.

14. Capital Budgeting
Capital budgeting is the
process that a business uses
to determine which proposed
fixed asset purchases it
should accept, and which
should be declined.

16. Why Do
Businesses Need
Capital
Budgeting?

17. Capital budgeting is
important because it creates
accountability and
measurability.

18. The End

19. Thank
You!