Basic Differences in Capital Structure of Two Firms

This video highlights the basic capital structure differences between two firms.

In the example taken, the two shoe firms, namely, Ben’s Shoes and Jason’ Shoes are two exactly same businesses, they operate similarly, and have the same revenue and operating profits. However, they have different capital structure which affects their net profits, and earnings per share.

This video is from Khan Academy.

Series NavigationAn Introduction to Capital StructureValue of a Firm (Using Operating Free Cash Flows)
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