Describe the importance of int

Importance of international capital structure are-

Capital structure is defined as a combination or balancebetween equity and debt which the business is use to finance itsday to day operation, assets and future growth.

Importance –

1. First and imporatnt matter of international capitalstructure is the company have effective overview of all her claimsthat most of the different players have on the business. The debtowner tight or hold these claims in the manner in lump sum of cashand accirding to these interest payment and the equity owner holdthese claims in tge manner of percentage of that firms futureprofit and depend on its earning.

2. It is easy to understand that how risky is investingin the business. and how the expensing the financing should be.Capital providers provide proportional weighting of different typesof fund which were financed to the company.

The risk can identify when working with cash, credit andinventory management is that-

Working with cash is better for organisation that givesmore beneficiary background to the company. And if company holdsmore cash than his maximum criteria then the company take lessreturn on the same. If these cash are in bank, the bank can giveinterest on them.

Credit Managent – By the way of credit management, thecompany are in more and more bad debts which company are in lossafter some time. An its usage of funds are restricted.

Inventory Management – Inventory management are thosetypes which the management are trackle all the inventory are inactual recieved or not. It is loss for the company if goods are notrecieved in actual.

So, this is the risk which identifying when working withcash, credit and inventory management.