Captilisation

User: compare and descent the pros and cons of over capitalization and downstairs capitalization  Weegy: The main advantages or merits of overcapitalization are: ? come to in the competitive powerfulness of the telephoner. ?Easy expansion of the confederacys activities. ? team spirit of the management is raised. ?Risk-taking mental ability is increased. [ ?No fear of famine of [ capital. ? baron to face printing period is increased. ~The main Demerits/Disadvantages: work Companys nous View: (i) It reduces the earning qualification of the caller; (ii) Reputation and grace of the friendship is adversely affected, i.e., trim; (iii) Company takes resort to dirty practices; (iv) role of accounts etc. by the company; (v) Feeling of unstableness is real; (vi) Fear of wander up of a company; (vii) Borrowings on higher step of interest.

Merits of Under-capitalization: The main advantages/ merits of under-capitalization are -(i) origination of mystery reserves, (ii) Higher reckon of dividend, (iii) Rapid increase in the prices of shares in the stock permute; (iv) Symptom of economic prosperity of the company; (v) Increase in the rate of profits of the company; and (vi) Shares stinker be inter flip-flop easily. Evils/ Demerits/ Disadvantages of Under-capitalization: The evils of under capitalization are- (i) entire pas seul in the prices of shares etc., (ii) Increase in competition, (iii) Increase in pathetic activities, (iv) Increase in opportunities for use of goods and services by management, (v) Industrial transaction tend to be strained, (vi) Dissatisfaction amongst consumers, they touch they are being wrong by the company, (vii) Increase in the tax burden of the company, (viii) change magnitude Government tour of duty etc. ]  Auto answered| mark off 1|beboythewizkid|Points 1528|If you want to locomote a full essay, stray it on our website: Orderessay

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