This presentation provides a comprehensive analysis of debt financing within the context of corporate financial management, focusing on its advantages, disadvantages, and various types. It begins with an overview of a case study involving RR Ltd, a fashion store considering debt financing as a source of capital. The presentation defines debt financing, outlines its benefits such as maintaining ownership and interest payments, and discusses its drawbacks, including fixed repayment schedules and collateral requirements. It further examines different forms of debt financing, including loans from financial institutions, debentures, and corporate bonds, highlighting their respective advantages and disadvantages. The presentation concludes that debt financing is a complex option requiring a balanced debt-to-equity ratio and suggests that RR Ltd could consider borrowing from multiple institutions or issuing debentures to mitigate risk. Desklib offers a variety of resources for students, including solved assignments and past papers to aid in their studies.
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