Central Intelligence (DVD)

Central Intelligence (DVD)

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Central Intelligence (Special Edition/DVD)

The story follows a one-time bullied geek who grew up to be a lethal CIA agent (Dwayne Johnson), coming home for his high school reunion. Claiming to be on a top-secret case, he enlists the help of the former „big man on campus“ (Kevin Hart), now an accountant who misses his glory days. But before the staid numberscruncher realizes what he’s getting into, it’s too late to get out, as his increasingly unpredictable new friend drags him through a world of shootouts, double-crosses and espionage that could get them both killed in more ways than he can count.

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Capital Structure Of A Company


CAPITAL STRUCTURE:

INTRODUCTION:

The capital structure of a company is referred to the way in which the company finances itself through debts, equity and securities; it can therefore be referred to as the capital composition of the company taking into consideration its liabilities, Modigliani and Miller propose the Modigliani Miller theorem of capital structure which states that the value of a company in a perfect market is unaffected by the way the company is financed but through the capital structure it employs.

Other theories to describe the capital structures employed by a company include the trade off theory, the agency cost theory and pecking order theory, and however the Modigliani Miller theory provides the basis at which a modern company should determine its capital structure.

The trade off theory recognizes that capital raised by firms is constituted by both debts and equity, however the theory states that there is an advantage of financing through debts due to tax benefit of the debts, however some costs arises as a result of debt costs and bankrupt costs and non bankrupt costs. The theory further states that the marginal benefit of debts declines as the level of debts and at the same time the marginal cost of debts increases as debts increase, therefore a rational firm will optimize by the trade off point to determine the level of debts and equity to finance its operations.

The pecking order theory was developed by Stewart Myers (1984) and it states that firms will adhere to the hierarchy of financing whereby the firm will prefer to finance itself internally and when all internal finances are depleted it will opt for equity, therefore this theory supports the fact that debts are preferred by firms than equity.

The agency cost theory analyses three costs which give explanation to the importance of the capital structure, these costs include asset substitution, underinvestment and cash flow; it gives the importance of management to adopt the most optimal form of capital structure.

MODIGLIANI MILLER THEORY:

This theory was developed by Merton Miller and Franco Modigliani, the theory is based on some assumptions that there are no transaction costs, there are no taxes and that there exist a perfect market and also rational investors exist in the market, through their first proposition they gave the example of two firms where one firm is financed through debts while the other one is not financed by debts but through equity.

In their theory they state that the value of the firm is determined by the debts and equity, where the value of a firm is derived from adding up the debts and equity. The following shows two firms where one firm is financed using debts and equity while the pother is financed by equity only, however as we shall see the value of the firm in the market are same in both cases.

FIRM X

FIRM Y

EARNINGS

10,000,000

10,000,000

RETURN ON ASSETS

100,000,000

100,000,000

DEBT VALUE

0

50,000,000

INTEREST ON THE DEBTS

0

5%

EXPENSES ON DEBTS

0

2500000

SHARES

10,000,000

5,000,000

PRICE PER SHARE

10

10

MARKET VALUE OF EQUITY

100000000

50000000

From the above table the market value of

Firm X will be 10,000,000 X 10 = 100,000,000

Where this firm is only financed by share sales and therefore the value of the firm is 100,000,000

Firm Y will be (5,000,000 X 10) + 50,000,000 = 100,000,000

This firm is financed through debts and equity, the value of debts is 50,000,000 and the value of its equity is 50,000,000, when we add this two we get the value of the firm which is 100,000,000, however the firm is required to pay interest on its debts which amount to 50,000,000 X 5% which gives us 2,500,000, therefore the returns on equity will be the earnings minus the interest on debts which will give us 100,000,000 – 2,500,000 = 95,500,000, the returns per share will be 95,500,000/ 10,000,000 = 9.55, therefore the returns on equity will be 9.55/10 = 9.55%, however if this firm had sold its stocks at a premium which is referred to as the leverage the firm could generate arbitrage profit.

The Modigliani miller theory also gives us a second proposition whereby there is the existence of tax, this proposition states that a levered firm expected returns will be given by a linear function of the ratio of debt and equity.

Therefore according to this theory the value of a firm is determined by the level of debts and equity, this aids the firm to determine the capital structure to adopt in order to achieve high profitability. However the theory is based on some drastic assumptions that there exist no transaction costs, no taxes, perfect market and that there exist rational investors and loans are obtained at the same rate. The theory is used by modern firms to determine the type of capital structure to adopt.

THE TRADE OFF THEORY:

This theory recognizes that capital raised by firms is constituted by both debts and equity, however the theory states that there is an advantage of financing through debts due to tax benefit of the debts, however some costs arises as a result of debt costs and bankrupt costs and non bankrupt costs.

The theory further states that the marginal benefit of debts declines as the level of debts and at the same time the marginal cost of debts increases as debts increase, therefore a rational firm will optimize by the trade off point to determine the level of debts and equity to finance its operations.

However the theory states that as the debt equity ratio increases (D/E) then there is a trade off between bankruptcy and tax shield and this as a result causes an optimal capital structure for the firm, the diagram below demonstrates the optimal capital structure a firm should adopt.

From the above diagram the optimal capital structure is at the point marked „O“ where there is the most optimal debt equity ratio that a firm should adopt.

However this theory has faced a lot of critics whereby Miller (1977) whereby he stated that the theory only seem to be an equivalent to a balance between a rabbit and a horse where the theory only considers debts and equity in financing in the absence of other factors that influence capital structure in an organization. Others critics‘ state that there are other factors such as the changes in the price of assets will result into the variations in the market structure of a firm.

Despite the various critics the theory still gives us the overall idea about determining the value of firms and how to choose the optimal market structure, it gives the important factors to consider when choosing the most optimal capital structure and it argues that financing through debts is more advantageous than through equity, this is depicted by the argument that as the ratio of debts to equity increases there is an increase in marginal benefits of debts but which will eventually decline and the marginal cost of debts will start rising. The theory takes into consideration the role played by debts, equity in financing a firm and also determining the value of the firm.

The other critic on this theory is that it does not give us the values of debt and equity to be adopted, it only gives a hypothetical approach to the levels of marginal benefits, marginal costs and also the bankruptcy cost and the interest and tax shield.

PECKING ORDER THEORY:

This theory was developed by Stewart Myers (1984), this theory states that firms will adhere to the hierarchy of financing whereby the firm will prefer to finance itself internally and when all internal fiancés are depleted it will opt for equity, therefore this theory supports the fact that debts are preferred by firms than equity.

A firm will finance itself internally, and then finance itself using debts and when these debts are depleted then the firm will finance through equity through sales of stock. Therefore equity financing is as a last resort to the firm, therefore the firm prefers to finance through a hierarchy of financing whereby they will finance through available funds, when these funds are depleted the firm will acquire debts and finally when this is depleted they will opt to finance through equity.

This theory is based on the assumption that the firm will always follow the hierarchy of financing, the firm will finance through internal funds and finally as a last resort finance through equity, this may not be true in practical terms because firms may not follow the hierarchy. However the theory advocates for finance through debts than finance by equity, this is the same case with the trade off theory.

AGENCY COST THEORY:

There are types of agency cost which tend to give explanation to the importance of the capital structure, they include asset substitution, underinvestment and cash flow.

  • Asset substitution:

This effect is comes as a result of an increase in the debt equity ratio which results into an increase in the incentive for managers to undertake risk to invest in projects, when this happens there will be a decline in the value of the firm which will result in wealth being transferred from the debt holders to the share holders.

  • Underinvestment problem:

The underinvestment problem results when the debts become more risky and therefore the gains from the projects will be accrued to debt holders rather than the share holders; this will result into the firm rejecting projects even if their net present value is positive and have the potential to increase the firm’s value.

  • The free cash flow:

The free cash flow is a problem whereby there is free cash flow in the firm, if this cash flow is not given to investors then there is a high possibility that the mangers of the firm will destroy the value of the firm.

Therefore the agency cost theory gives the clear indication of the importance of capital structure; it gives the importance of management to adopt the most optimal form of capital structure.

EVALUATION:

The theories of capital structure give the indication of the importance of adopting an optimal capital structure, the trade off theory, the pecking order theory and the agency cost theory all advocate for the financing of a firm through debts rather than finance by equity, they advocate for an increase in the debt equity ratio, this will result in the firm determining the most optimal capital structure through increased marginal benefits as the marginal cost decline.

The Modigliani miller theory assumes that the value of a firm is determined by the debts and equity, the value of the firm is given by adding up the level of debts and equity, however Merton Miller and Franco Modigliani assume that there are no transaction costs, no taxes and there exist a perfect market. However it is the only theory that gives guidelines to modern firms regarding the capital structure these firms and organizations should adopt, this theory however is based on some drastic assumptions but like all theories there has to be assumptions made to derive the required relationship between variables so as to state the theory, however other theories should not be rejected as they still have their own idea on how firms should adopt capital structure and combinations of equity and debt that are most optimal.

CONCLUSION:

Capital structure is very crucial to a firm’s value; the capital structure will determine the final value of the company whereby the value of the company will be determined by the level of equity and debts, the Modigliani miller theory states that the value of the firm is determined by the debts and equity, where the value of a firm is derived from adding up the debts and equity. They considered two firms where one firm is financed using debts and equity while the other is financed by equity only, however the value of the two firms in the market are same in both cases.

The trade off theory also recognize that capital raised by firms is constituted by both debts and equity, however the theory states that there is an advantage of financing through debts due to tax benefit of the debts, however some costs arises as a result of debt costs and bankrupt costs and non bankrupt costs, the theory also states that the marginal benefit of debts declines as the level of debts decrease and at the same time the marginal cost of debts increases as debts increase, therefore a rational firm will optimize by the trade off point to determine the level of debts and equity to finance its operations, the theory also states that as the debt equity ratio increases (D/E) then there is a trade off between bankruptcy and tax shield and this as a result causes an optimal capital structure for the firm.

The agency cost theory analyses three costs which give explanation to the importance of the capital structure, these costs include asset substitution, underinvestment and cash flow; it gives the importance of management to adopt the most optimal form of capital structure.

The pecking order theory which was developed by Myers in 1984 states that firms will finance through a hierarchy of finance options, therefore this theory supports the fact that debts are preferred by firms than equity, the firm will finance itself internally, and then finance itself using debts and when these debts are depleted then the firm will finance through equity through sales of stock. Therefore equity financing is as a last resort to the firm, the firm prefers to finance through a hierarchy of financing whereby they will finance through available funds, when these funds are depleted the firm will acquire debts and finally when this is depleted they will opt to finance through equity.

Finally it is clear that the Modigliani miller theory is the only theory that gives a clear guidance to the form of capital structure that firms should adopt. It is the only model that gives guidelines to modern firms regarding the capital structure these firms and organizations should adopt, this theory however is based on some drastic assumptions but like all theories there has to be assumptions made to derive the required relationship between variables so as to state the theory.

REFERENCES:

Ludwig Lachmann (2000) Capital and capital Structure, University of Michigan, Michigan

Michael Hank (2003) Credit Risk and Capital Structure, Springer press, New York

Robin Wood (2001) Managing Complexity, Prentice hall publishers, New York

Walter B. and Robert F. (2003) Financial Accounting, McGraw Hill publishers, New York

Zane Swanson (2003)The Capital Structure Paradigm: Evolution of Debt and Equity, McGraw Hill publishers, New York

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Wagan IN9438 12V Heated Seat Cushion with Lumbar Support (Black Velour)

Wagan IN9438 12V Heated Seat Cushion with Lumbar Support (Black Velour)

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Wagan 12 Volt Velour Heated Seat Cushion with Lumbar Support is a great companion for cold winter days. Super soft velour and polyester feel luxurious and provide ultimate comfort and warmth. Easy to use – simply plug into your vehicle’s 12 volt outlet. Features a high/low/off switch so you can control the heat setting. Maximum heating temperature is 114 degrees Fahrenheit. Also features lumbar support for the lower back. Powered by 12 volt DC. DC cord is 4.3 feet. Straps in the back of the cushion to hold the cushion in place and secure it to your seat. Light and portable so it is convenient to take from one car to another. Enjoy soothing heat in the comfort of your vehicle. An optional AC adapter is available for home and office use (Wagan item number 9903 AC adapter).Super soft velour and polyester feels luxurious and comfortable
Maximum heating temperature of 114 degrees Fahrenheit. High/low/off temperature control
Has a 0.5 inch thickness for lumbar support
Simply plug into your vehicle’s 12 volt DC outlet
Universal fit for most cars, trucks, RVs and boats



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Android2.1: Google Nexus One Price Exposed


Recently, every day there is lots of new information about Google mobile phones. epathchina.com is one of the company that keeps a keen eye on its movement. There is a piece of latest news again.

1. Google phone price exposure

Google Nexus One will be officially released on January 5th in 2010; this message has been confirmed by many sides, at the same time, the price of Nexus One has also been exposed on the Google Nexus One page. According to the exposed price, if the user choose T-Mobile package, he can buy the Gphone with the signing price of $179.99, however, the non-signing unlocked Nexus One will be sold at $530.

Google Nexus One is so anticipating mainly because the mobile phone is considered as the most sterling Android system by Google; besides, it carries the latest version of the Android 2.1 operating system, and the user interface specially developed for the phone will also make the Nexus One appear with a brand-new image.

2. Release time

Another piece of news, using one Google account can purchase only 5 Nexus One cell phones at most. In addition, Nexus One may sell to overseas markets. And this kind of mobile phones will be for sale on www.google.com/phone.

In addition to this, if users buy a Nexus One with subsidies, and they use the phone less than 120 days; then users need to pay $350 price difference or turn the mobile phone back to Google. It can not get the answer of the question that whether the Nexus One will be sold by entity shop until next January 5.

As a dropshipping company focusing on electronics, epathchina.com likes to pay attention to the leading companies which has similar business. Epathchina.com also has a broad selection of mobile phones with Android system. Consumers can also buy quality android phones from epathchina.com online shop. Moreover, a large number of other multi-functional and multi-shaped mobile phones will be good choices for customers.

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Japanese Homes and Their Surroundings (Dover Architecture)

Japanese Homes and Their Surroundings (Dover Architecture)

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This work deals with every aspect of the traditional Japanese home, from its general plan and major structural features to such ceremonial and traditional appointments as the tatami mats (which actually determine the size of the house), lamps, hibachi (braziers), fusuma and shoji screens, candlesticks, pillows, and tokonoma (places where art objects or flowers are displayed). It covers details of both construction and architectural ornamentation, and it points out the many ways in which the traditional Japanese house achieved the almost ideal blend of art and nature, decoration, and stark simplicity that is its hallmark. It shows in detail such things as how natural irregularities (such as in logs) are used to advantage, how partitions change the shape of the interior, and how the garden with its bridges, lanterns, and natural forms (sometimes artfully wrought) complements the severity of the house itself. More than 300 drawings by the author illustrate the text.
Morse was one of the first to try to see and understand a dwelling in terms of the culture and tradition of the people who live in it. As a result, this work, which for three generations has remained the most informative and exhaustive discussion in English of the Japanese home, is equally honored for its strikingly modern conception of architecture and, more particularly, of the Japanese home as a place where people live.
Since this work was first published, many of the traditional features of the Japanese home have altered under the impact of Western ideas. The work, consequently, should be particularly valuable to contemporary architects, artists, structural engineers, and scholars who want a purer view of the traditional Japanese dwelling. Because of its wealth of suggestion, it will also prove valuable to designers and craftsmen. For laymen, it continues to offer insight into a type of architecture (and a way of life) that is having an increasing impact on Western ideas.



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Sat Nav Devices: Your Best Bet for Finding Unknown Locations


The capability of the portable sat nav devices to sniff out obscure locations has made them the hottest selling gadgets – particularly among frequent travelers and globe trotters. Road users have been more than happy with all the innovative features of many such devices, which they can use to their advantage in finding their way across different areas. They can accessorize their cars and bikes with these gadgets, a fact that is making these devices all the more useful.

The users of these devices can stay focused on the road and have some of their co-passengers take over the navigation. Satellite Navigation Systems work by retrieving exact locations and the necessary traffic information from orbiting satellites and feeding the data to in-built LCD screens. The calculated location is then presented on a detailed map so that the users can track their movement en-route to their desired destinations. Most sat nav devices come with a user selectable voice, which tells the driver when to take a turn or warns them of any known problems such as a speed camera.

In a recent survey of company car drivers covering over one million miles in the UK, it was found that drivers with a GPS safety device fitted to their vehicle were 50% less prone to have an accident and 74% less likely to have a speeding endorsement. The latest sat nav models come laden with extra performance packed features such as speed-trap locators and the ability to navigate by photos on maps. With such devices, you would no more need the bells and whistles. One fact you should keep in mind is that the camera locations can change. To keep pace with the change, you’ll need to buy updates to assist you in avoiding any unwelcome points on your license.

There’s a great range of sat nav devices in the market as of now, and the users are not limited in the choices that they can make. Competition in the auto accessory sector is fierce, which means low prices and bewildering choices. No matter how modest or swish your tastes, there is a well-priced model to suit your budget.

Adding a sat nav is the safest way of instantly upgrading your car and making journeys go more smoothly and economically. In fact, you should plan your long trips better and cut down on unnecessary ‚lost‘ mileage which invariable happens when using a paper map. In addition, many of these devices are integrated with MP3 players that can make the trip, voyage or journey quite unforgettable.

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Source by Adam Caitlin

The Innovators: How a Group of Hackers, Geniuses, and Geeks Created the Digital Revolution

The Innovators: How a Group of Hackers, Geniuses, and Geeks Created the Digital Revolution

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Following his blockbuster biography of Steve Jobs, Walter Isaacson’s New York Times bestselling and critically acclaimed The Innovators is a “riveting, propulsive, and at times deeply moving” (The Atlantic) story of the people who created the computer and the Internet.

What were the talents that allowed certain inventors and entrepreneurs to turn their visionary ideas into disruptive realities? What led to their creative leaps? Why did some succeed and others fail?

The Innovators is a masterly saga of collaborative genius destined to be the standard history of the digital revolution—and an indispensable guide to how innovation really happens. Isaacson begins the adventure with Ada Lovelace, Lord Byron’s daughter, who pioneered computer programming in the 1840s. He explores the fascinating personalities that created our current digital revolution, such as Vannevar Bush, Alan Turing, John von Neumann, J.C.R. Licklider, Doug Engelbart, Robert Noyce, Bill Gates, Steve Wozniak, Steve Jobs, Tim Berners-Lee, and Larry Page.

This is the story of how their minds worked and what made them so inventive. It’s also a narrative of how their ability to collaborate and master the art of teamwork made them even more creative. For an era that seeks to foster innovation, creativity, and teamwork, The Innovators is “a sweeping and surprisingly tenderhearted history of the digital age” (The New York Times).SIMON SCHUSTER



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Waste Management-The Global Issue


Waste management or appropriate waste disposal is not a country or continent specific problem, now it has emerged as a global concerning issue posing as a threat to global health and environment.

Since the rapid development of information technology, electronic waste has extensively increased but the excess waste had to go to either landfill or incinerators. Insensitive disposal off the e-waste has several dangerous consequences on environment. It is responsible for producing greenhouse gas, making weather warmer and causing various skin and respiratory diseases. Landfills in Latin America, Asia, and Africa generate approximately 40 % of methane emissions annually that is equal to about 37 million metric tons of carbon dioxide. Asian countries such as China, India, Indonesia and the Philippines do not have well-planned  management system for proper e-waste disposal. E-waste in landfill emits cancerous carcinogen in the air and come to us through disease carrier vermin, flies and pests.

Consequences might not be felt immediately but future generation will have to pay the price. A growing number of countries have raised voices against the situation and are demanding for legal amendments for proper e-waste management.

According to the U.S, 60% countries worldwide have shown their concern. Countries like Canada and the US are inspiring people to reduce, reuse and recycle. Several state governments are implementing rules and regulations for effective e-waste management.

According to the experts‘ estimation, industrialized countries generate more waste than developing or industrialising countries. In the United States, each American produces .75 tons of trash every year on an average, European countries accumulate almost half a ton of trash every year and in Asia, a person produces mere .2 tons of trash at an average annually. World Bank reveals that every year China contributes about190 million tons of waste, which is not appropriately disposed. Whether it is incineration or through landfill, only a fraction, less than 50%, of total solid e-waste is discarded properly.

Irrespective of countries or boundaries, nations have come together to solve this ever growing environmental issue. European countries have already developed over 60 percent of environmental technologies to help the world. Research agencies are also playing their part by awakening people about the environmental damages caused by them and helping them deal with air, water contamination.

For more information on recycling, visit www.asset-recoveryservices.com

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Clear Pond Beneficial Bacteria Liquid, 32-Ounce

Clear Pond Beneficial Bacteria Liquid, 32-Ounce

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The Clear Pond Beneficial Bacteria formula has been developed to be beneficial to pond life and is non-pathogenic and non-toxic. Clear Pond Beneficial Bacteria is a blend of enhanced patented bacteria cultures developed for their ability to produce large quantities of digestive enzymes in an aquatic environment. Beneficial bacteria are important for a clean healthy pond. When used on a regular basis Clear Pond’s bacterial formula helps to promote a healthy balance pond that will naturally reduce the effects of string algae, pea soup green water and sludge that usually builds up at the pond bottom.100-percent environmentally safe
Treats up to 32,000 gallons
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Why cash budget is important an organization?


If you are working in the Finance Department of an organization, I bet you would know how important the cash budget is.  Every organization knows the significant of a cash budget and how it can determine the future direction of its business.

In fact cash budget is one of the key components of a master budget. From my experience, it is the most difficult budget to prepare compare to the rest. The rest of the components are sales budget, purchase or cost of sales budget, operating budget and capital budget.

Cash budget is in reality a plan or forecast of cash inflow and cash outflow events which are anticipated to take place in the near future. It can be a net cash surplus or net cash shortfall position.

If the organization has surplus cash in the budget, action plans will be laid down on how to utilize the cash effectively.  Examples would be the surplus cash can be dividend out to the shareowners or can be reinvested to expand the business. 

If there is no clear direction yet, the most prudent and straight forward way to manage the surplus cash is to place it in the money market to earn interest. There are a variety of rates in the money market. You can put cash on a daily, weekly, monthly or yearly plan. The long the plan the higher is the interest rate.

In the event that the budget shows that the organization will have a shortfall cash position in the near future, plans must be devised on how to get additional cash to finance the shortfall position. It is very crucial to see that the organization has cash to finance the shortfall position in order to carry on its operations smoothly.

Some of the common ways to bring in cash would be new cash capital injection, getting loans from banks and getting temporary loans from directors or other parties. In the case of loans, the organization will be expected to pay the loaner some interests which will result in extra expenses.

Not all shortfall cash budget signifies that the organization makes losses.  Shortfall cash budget could happen in situation whereby cash is required to finance the cost of a profitable business venture upfront before revenue can be collected at the later stage.

Learn how to prepare budget and forecast at <http://budgetingandforecastingsoftware.org/business-income-budget.php>

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Source by Shao Jye