ERM-813-15: Financial Structure, Capital Structure (Capitalization), and Leverage Explained


#1

Reading Source: ERM-813-15 Study Note

Topics Covered in this Reading:

  • Financial Structure Defined and Illustrated
    • Measuring Financial Leverage
  • Capital Structure Defined and Illustrated
    • Measuring Capital Leverage
  • Leverage, Business Risk, Financial Risk and Gearing Ratios
  • Leverage Consequences for Investors
  • When is There Too Much Debt? Too Little Debt?
    • Too Much Debt
    • Too Little Debt
    • Acceptable Leverage Metrics and Target Leverage Metrics
  • How do Companies Change Financial and Capital Structures?