IPU Financial Management Notes Unit 3

Download BBA Financial Management Notes. FM is an important subject and taught generally in 4th semester of GGSIPU BBA program. Topics covered in the note are as follows:

UNIT 3 Cost of Capital

• Cost of Capital- Meaning and Classification
• Methods of Calculating Cost of Equity Capital
• Cost of Retained Earnings
• Cost of Debt Capital
• Cost of Preference Capital
• Weighted Average Cost of Capital (WACC)
• Capital Structure
• Net Income Approach
• Net Operating Income Approach
• Modigliani and Miller (MM) Approach
• Traditional Approach
• Determination of Capital Structure
• Leverage- Concept and Significance
• Leverage Types- Operating, Financial, Capital and Working Capital Leverage