Capitalization is an accounting method in which a cost is included in the value of an asset and expensed over the useful life of that asset, rather than being expensed in the period the cost was originally incurred.

When terms denoting family relationships are used as proper nouns (as names), they are capitalized. In the examples above, Mom, Dad, and Grandma are capitalized because they are being used like names. You could replace them with proper names without changing the rest of the sentence.

It should not be capitalized. Other resources don’t like capitalizing “parents.” Note that we all agree that Dear Mom or Dear Dad are appropriate when we are using “Mom” or “Dad” as nicknames.

If you are using the word ‘Father’ or ‘Dad’ as a proper noun, then you should use a capital letter. But if you are using ‘father’ or ‘dad’ as a common noun, you shouldn’t capitalise the ‘f’. This could look like this: All fathers should have equal rights with mothers.

Chicago Manual of Style Capitalization Rules The rules are fairly standard for title case: Capitalize the first and the last word. Capitalize nouns, pronouns, adjectives, verbs, adverbs, and subordinate conjunctions. Lowercase articles (a, an, the), coordinating conjunctions, and prepositions.

Financial structure refers to the balance between all of the company’s liabilities and its equities. Capital structure, by contrast, refers to the balance between equities and long-term liabilities. Short-term liabilities do not contribute to capital structure.

Important. It is the goal of company management to find the ideal mix of debt and equity, also referred to as the optimal capital structure, to finance operations. Analysts use the debt-to-equity (D/E) ratio to compare capital structure. It is calculated by dividing total liabilities by total equity.

Capital Structure refers to the proportion of money that is invested in a business. It has four components and it includes Equity Capital, Reserves and Surplus, Net Worth, Total Borrowings.

The various factors which influence the decision of capital structure are:

• Cash Flow Position:
• Interest Coverage Ratio (ICR):
• Debt Service Coverage Ratio (DSCR):
• Return on Investment:
• Cost of Debt:
• Tax Rate:
• Cost of Equity:
• Floatation Costs:

Capital structure maximizes the market value of a firm, i.e. in a firm having a properly designed capital structure the aggregate value of the claims and ownership interests of the shareholders are maximized. Cost Minimization: Capital structure minimizes the firm’s cost of capital or cost of financing.

The term capital gearing refers to the ratio of debt a company has relative to equities. It is also referred to as financial gearing or financial leverage. A company is said to have a high capital gearing if the company has a large debt as compared to its equity.

Definition: Capital structure refers to an arrangement of the different components of business funds, i.e. shareholder’s funds and borrowed funds in proper proportion. A business organization utilizes the funds for meeting the everyday expenses and also for budgeting high-end future projects.

Planning of Capital Structure | Accounting

1. Factor # 1. EBIT-EPS Analysis:
2. Factor # 2. Cost of Capital:
3. Factor # 3. Cash Flow Analysis:
4. Factor # 4. Control:
5. Factor # 5. Timing and Flexibility:
6. Factor # 6. Nature and Size of the Firm:
7. Factor # 7. Industry Standard:

Liability side of balance sheet is made under perfect capital structure planning. Finance manager and other promoters decides which source of fund or funds should be selected after monitoring the factors affecting capital structures. So, capital structure planning makes strong balance sheet.