Explain the Difference Between a Simple and Complex Capital Structure

question 30

Essay

Explain the difference between a simple and complex capital structure as the terms are used in the calculation of EPS.

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Definitions:

Market Value

An estimation of the price at which an asset or company could be bought or sold in a current market.

IFRS

International Financial Reporting Standards represent worldwide accounting norms that facilitate the creation of financial statements.

GAAP

Generally Accepted Accounting Principles, a set of rules and standards used for financial reporting and accounting.

Principles-based

An approach that bases decisions on general principles or values rather than specific rules.