The Impact of Debt Policy on Financial Performance of Romanian Listed Companies
Journal Title: Annals of "Dunarea de Jos" University - Fascicle I. Economics and Applied Informatics - Year 2014, Vol 20, Issue 1
Abstract
The purpose of this paper is to study the impact of listed companies’ indebtedness on their financial performance. Theoretical research was relied on the specialty literature concerning the analysis of the capital structure and financial structure of the company based on calculation of the financial structure ratio and financial leverage. This paper focuses on the analysis of debt policy impact on companies’ financial performance using the financial leverage method. The financial leverage method reflects the influence of debt policy on company’s return on equity, as well as the ways it engages loans to finance operating assets so it can get higher return on equity. The main aim of this paper is to investigate and analyze the determinants of leverage effect and financial structure of companies that are operating in Romanian food industry, namely manufacturing of dairy products. The conclusion that emerges in this study is the importance of choosing and establishing funding sources by an enterprise, according to funding costs, in order to obtain the optimal combination between external financing resources and internal funding.
Authors and Affiliations
Nicoleta BARBUTA-MISU, Andreea RUSU
Keywords
Related Articles
- EP ID EP117643
- DOI -
- Views 112
- Downloads 0
The SPA Tourism Perception in Romania
Tourism or geriatric-medical and wellness tourism are market segments that lately have registered significant increases. The need to define, organize, and promote these sectors. This item is intended to synthesize develo...
Cluster Economic Performance Concept – Present Experiences and Future Developments
Cluster-based economic development has become an increasingly popular topic for researchers and economic development professionals. Clusters are groups of companies and institutions co-located in a specific geographic re...
Designing a Virtual Center for E-Commerce
In the actual context of developing digital services, the promotion of a system that manages multiple e-commerce sites can be extremely valuable in increasing the economic effects for the companies. This paper presents t...
The Crisis Impact on the Labour Market
The aim of this paper is to discuss the impact of the current global economic crisis on the labour market, including the risk that the recession will be followed by a jobless recovery that contributes to a lost generatio...
The Macroeconomic Outlook and the Impact of the Global Crisis in the Euro Area
This paper provides general analysis and evolution of macroeconomic and financial indicators in the euro area, during the recent crisis 2008-2009. The financial market turmoil that began in 2007 led to a severe global ec...