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- Publisher
- Wiley
- Copyright
- Copyright © 1995 Wiley Subscription Services, Inc., A Wiley Company
- ISSN
- 1078-1196
- eISSN
- 1745-6622
- DOI
- 10.1111/j.1745-6622.1995.tb00259.x
- Publisher site
- See Article on Publisher Site
Abstract
Footnotes 1 . SIC classifications between 2,000 and 5,999. 2 . Using COMPUSTAT balance‐sheet data provides a broad view of corporate debt. In addition to bonds and mortgages, long‐term debt also includes capitalized lease obligations, forestry and paper companies' timber contracts, publishing companies' royalty contracts payable, and similar long‐term fixed claims. Shortterm debt (debt in current liabilities) includes short‐term notes, bank acceptances and overdrafts, the current portion of long‐term debt, and sinking funds or installments on loans. 3 . The market value of the firm is estimated as the book value of total assets minus the book value of equity plus the market value of equity. 4 . Restrictions on leverage in bond covenants also are invariably expressed in terms of book, not market, values. 5 . Lee Green, Sportswit (New York: Fawcett Crest, 1984), p. 228. 6 . See Merton Miller, “Debt and Taxes,” Journal of Finance (1977), 261‐275. 7 . Harry DeAngelo and Ronald Masulis , “ Optimal Capital Structure Under Corporate and Personal Taxes ,” Journal of Financial Economics , Vol. 8 ( 1980 ), pp. 3 – 29 . 8 . If companies choose different dividend policies for reasons other than taxes, then investors
Journal
Journal of Applied Corporate Finance – Wiley
Published: Jan 1, 1995