Monday, February 24, 2020

ASSESSMENT Essay Example | Topics and Well Written Essays - 1250 words

ASSESSMENT - Essay Example Non-conventional types of dividend payments, particularly share repurchases are in most cases used currently, and therefore, the dividend decision is much more multifaceted and complex than it was in the past. In addition, there are more significant types of shareholders who should be satisfied today-particularly institutional investors-while managers once merely have to satisfy individual stockholders. Therefore, n increase in the dividend payout is taken to be good news. The company is showing that it not only has positive cash flows, however these cash flows are rising sufficiently to validate an elevated payout to shareholders. The company â€Å"proves† its cash flow by paying out some of that cash to its shareholders. This means that higher dividends might indicate lasting greater earnings for the company. How this argument has been contradicted that the dividend policy is irrelevant. It is for this reason that this paper will examine on the fact that company's dividend p olicy is irrelevant to its market value. ... i-Miller (M&M) theorem, (Irrelevancy Theory) (1961) forwarded by Franco Modigliani and Merton Miller, influences the base for modern view on capital structure, although it is usually perceived as merely scholarly because it presumes away numerous significant elements in the capital structure decision. The theorem argues that, in a perfect market, the value of a firm is irrelevant to how that firm is funded. This outcome offers a basis used to study real global reasons why capital structure is appropriate. These other reasons comprise agency costs, bankruptcy costs, information asymmetry, taxes among others. The theorem has been used to show that dividend is irrelevant to firm’s market share. Merton Miller and Franco Modigliani (MM) under their theory argued that in perfect financial markets (no transactions costs certainty, no taxes, or other market imperfections), the value of a company is impacted by the allotment of dividends. They claim that company’s value is mainl y driven the prospective income and risk of its investments, therefore, maintaining income or paying them to the shareholders in dividends does not affects its value (Grullon et al 2002). MM through its theory indicated that provided the company is attaining the returns anticipated by the market, it does not matter whether the returns is directed to the stockholder as individuals currently, or reinvested. They would perceive it in terms of dividend or price appreciation. Therefore, in this case the shareholder can develop their individual dividend through selling the stock when they need cash (Lie 2000). They qualified their argument through this calculation: V t = 1/1+rt[Dt+Vt+1-m t+1P t+1] Where rt = Discount rate Dt = Total Dividends Paid V t+1 = Firm Value @ t+1 = ntP t+1 M t+1P t+1 = Amount

Friday, February 7, 2020

Assignment 1 Example | Topics and Well Written Essays - 250 words - 26

1 - Assignment Example There has to be accurate harmonization between jobs as well as vertical smooth communication amongst job levels in order to obtain inter-functional coordination. The meaning of this is that the management of an organization must be used to gaps of employment such as shortages, surplus, or even deficiencies in between levels of jobs as well as job categories. (Zeiger, 2014) For this to be achieved there is the requirement for knowledge of, as well as control over the workforce elements as well as their individual connections. If decisions are to be made in the absence of such inter- connections linked between job levels as well as job categories, the outcome will be a labor force which is disgustingly out of balance in terms of moreover a qualitative sense or a quantitative sense. The decisions that are made for the adjustment of gaps of employment are dependent on, together the external sources of employment as well as the internal sources of employment. For instance, if decisions are poorly conceived, the outcome could be the impossibility of promoting from within caused by understaffing. Another reason for this could be absence of employee training at certain job levels or in certain job categories (Zeiger, 2014). The lack of ability to promote from the inside is a clear implication of additional expenditure for the firm caused by requirement of external recruitment as well as the lack of progression for the employees in the organization. Decisions on job categories and levels are critical to the conduct as well as results of the HRP since they are a way to achieve the goals o the organization. Their absence is likely to lead to a workforce that is imbalanced. In addition, they help cut costs of the organization through internal recruitment and create employee