Critically evaluate the features of all capital structure components and respond the following questions with justifications:

Capital structure is simply technique that is used to learn a word. How the capital of the form is structured in the operations of the company. Capital structure is mixture of the dead and the equity of the preferred shares that are considered while taking the scene of the company.

a)      Which capital structure component(s) is/are considered as a true equity for the company?

Equity share capital and retained earnings are considered as a true equity that are called shareholder's preferred share. Because there are amounted that are invested with no fixed payments in our financial.

b)     Which capital structure component(s) is/are considered as liability for the company?

Components that are considered liabilities are interest born issued debenture issue terms, loans and other investment or loan that are replies in the business. They will have a pitched coupon on interest rates which are needed to be paid. Even the complete do not make profit in the year. Fixed interest on bonds and loans are most to be paid by the company to the debtor of the company.

c)      Which capital structure component(s) is/are considered as non-interest-based liability for the company?

Liabilities that are non-interest-bearing means that the interest on the liabilities will not be charged until they fade. Preferred shares will come under this category as there is no interest paid on the profit. She preferred shares her and there is no requirement to pay dividend as at a fixed percentage of that is not accrued.

2.      Which capital structure component(s) is/are considered as non-interest-based liability for the company?

An efficient and effective market focus on the fair price mechanism helps to an investor to copy the index and then make the possible return to the shareholders. There is an efficient and effective market hypothesis that is objective to educate and translated the theory that he said that share price reflect all the public as well as private companies that are based on such information and there is no scope of basic as well as technical analysis to make extraordinary rate of return to the market. According to the market analysis, the best strategy for investors is to emphasize on the passive investment strategy by investing into index fund that help the invested to make the maximum return as there is no space for different kinds of analysis to make extraordinary profit. An efficient market is helpful to gain the objectives of the investor as there are private information are already discounted, so there are no scope or fraud left in the US investment market.

There is no scope of our technical analysis. There would not be name much difference between analysis and. Behavior of the investors. There is no scope for any insider trading in the efficient market as well. An investor who working efficient in the market is not liable to exports any kind of risk in the market. As it is always reflecting the trust value and he would not be cheated or malpractice or fraud in the market. Therefore there is no hedging and arbitrating required dealing such kind of investor. So that they would save a lot of their money that is required to fundamental analysis as well as technical analysis so that it would be other reason to save a lot of cost of analysis. There is no requirement of basic analysis as well as technical analysis to gain. Thus, to gain that investors portion in the investment, investors must conduct financial analysis beyond the list of working on traditional or other analysis.

Question # 3. Using SULMS reading material of National Aluminum Products and exercise material of Oman Cement and Dhofar Beverages, please fill the following table (in yellow spaces) as per following:

a)     In ‘Amount’ column, write the amount of each capital structure component of both companies. Use ‘Notes of Accounts’ of both companies for help.

                                                                                                                        (3 Marks)

b)    In ‘% age’ column, write the percentage of each component with respect of total amount of capital in both companies

                                                                                                                        (3 Marks)