Financial Barometers
Barometers are the instruments to measure Atmospheric pressure. In this presentation, bar charts have been used as Financial Barometers to analyze the pressure (effect) of different expenses/factors on the financial health of a company - leading to over capitalization.
What is over capitalization?
Over capitalization is that state of financial affairs of a company, in which the real value of a company’s assets is much less than their book value, leading to a permanent decline in the earning capacity of the company. As a result, the company is unable to pay a fair rate of return on the equity; leading to a decline in the market value of its shares and resulting in a considerable loss of goodwill of the company.
Barometers are the instruments to measure Atmospheric pressure. In this presentation, bar charts have been used as Financial Barometers to analyze the pressure (effect) of different expenses/factors on the financial health of a company - leading to over capitalization.
What is over capitalization?
Over capitalization is that state of financial affairs of a company, in which the real value of a company’s assets is much less than their book value, leading to a permanent decline in the earning capacity of the company. As a result, the company is unable to pay a fair rate of return on the equity; leading to a decline in the market value of its shares and resulting in a considerable loss of goodwill of the company.