What is Capital in Finance Explanation, Definition and Meaning

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In economics, a stock of resources that may be employed in the production of goods and services. In classical economics it is one of the three factors of production, the others being labour and land. Capital may be so broadly defined as to include all possible material, nonmaterial, and human inputs into a productive system,…

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What is Inventory in Accounting Explanation,Definition and Meaning

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In business, any item of property held in stock by a firm, including finished goods held for sale, goods in the process of production, raw materials, and goods that will be consumed in the process of producing goods to be sold. Inventories appear on a company’s balance sheet as an asset. Inventory turnover, which indicates…

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What is Bond in Finance Explanation, Definition and Meaning

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In finance, a loan contract issued by local, state, or national governments and by private corporations specifying an obligation to return borrowed funds. The borrower promises to pay interest on the debt when due (usually semiannually) at a stipulated percentage of the face value and to redeem the face value of the bond at maturity…

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What is Reorganization,Reorganization Explanation,Definition and Meaning

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When a firm cannot operate profitably, the owners may seek to reorganize it. The first question to be answered is whether the firm might not be better off by ceasing to do business. If the decision is made that the firm is to survive, it must be put through the process of reorganization. Legal procedures…

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What is Mergers, Mergers Explanation,Definition and Meaning

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Companies often grow by combining with other companies. One company may purchase all or part of another; two companies may merge by exchanging shares; or a wholly new company may be formed through consolidation of the old companies. From the financial manager’s viewpoint, this kind of expansion is like any other investment decision; the acquisition…

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What is Holding Company, Explanation, Definition and Meaning

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Holding company is a corporation that owns enough voting stock in one or more other companies to exercise control over them. A corporation that exists solely for this purpose is called a pure holding company, while one that also engages in a business of its own is called a holding-operating company. A holding company typically…

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What is Conglomerate, Explanation, Definition and Meaning

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Conglomerate in business, a corporation formed by the acquisition by one firm of several others, each of which is engaged in an activity that generally differs from that of the original. The management of such a corporation may wish to diversify its field of operations for a number of reasons: making additional use of existing…

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What is Corporations, LLC and Company Definition and Meaning

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Corporations or company also called Limited Liability Company, a specific legal form of organization of persons and material resources, chartered by the state, for the purpose of conducting business. As contrasted with the other two major forms of business ownership, the sole proprietorship and the partnership, the corporation is distinguished by a number of characteristics…

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What is Dividend and Stock Dividend Definition and Meaning

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An individual share of earnings distributed among stockholders of a corporation or company in proportion to their holdings and as determined by the class of their holdings. Dividends are usually payable in cash, although sometimes distributions are made in the form of additional shares of stock. In a dividend reinvestment plan (DRIP), dividends are automatically…

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What is Preferred Stock, or Preference Shares Definition and Explanation

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Preferred stock, or preference shares. To appeal to investors who wish to be sure of receiving dividends regularly, many companies issue what is called preferred stock, or preference shares. This class of stock has a prior claim to dividends paid by the company and, usually, to the assets of the company in the event of…

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