Start networking and exchanging professional insights

Register now or log in to join your professional community.

Follow

Capital structure is important for company's performance. Based on your knowledge , why multinational companies prefer debt rather than the equity?

user-image
Question added by Ahmed Hassan Hadi , Teller , Amal Express
Date Posted: 2015/08/25
Oluseun Kehinde
by Oluseun Kehinde , Regional Accountant , Regency Alliance Insurance Plc

Debt as a form of capital has a fixed interest rate and irrespective of any profit made, this can not be increased. As a result of this, most multinational companies that make big profit, big enough to cover any interest will prefer to take debt as a capital since its cost is fixed right from the point of taking it.

More Questions Like This

Do you need help in adding the right keywords to your CV? Let our CV writing experts help you.