Abstract
Making decision about the capital structure is one of the most difficult and challenging issues facing companies. In this direction, the aim of this study is to investigate the impact of financing on evaluating the performance of companies listed on the Stock Exchange in Tehran through debt and the optimal structure of debt. The research sample is consisted of 179 companies during years 2010 to 2013. Here, the research method is descriptive and in terms of purpose is functional. Multivariate regression analysis, based on the method of combined data was used for testing hypotheses. The research results showed that there is a negative and significant relationship between financing through debt and performance. Also, there is a positive and significant relationship between the optimal structure of debt and the performance of the company, and difference of the average of efficiency, between optimal and non-optimal structure of debt is 0.182 and meaningful. DOI: 10.5901/mjss.2015.v6n6s6p101
Highlights
An environment in which our country is active is a growing and very competitive environment and companies are forced to compete nationally and internationally and to develop their activities through new investments in order to survive
In the rest of the article, firstly we will briefly review the literature associated with capital structure, financing methods, informational asymmetry and representation costs, the method of measuring variables and classification of companies into optimal and non-optimal structure is expressed
The results obtained from testing the first hypothesis of the research show that financing with the criterion of the ratio of short-time and long-time debt has a negative and significant relationship with company's performance
Summary
An environment in which our country is active is a growing and very competitive environment and companies are forced to compete nationally and internationally and to develop their activities through new investments in order to survive. There are few theoretic approaches in this relationship including Miller and Modiliani's theory (1985) and in a total capital market; options of financing do not have an impact on the cost of company's capital, or true operation or value including performance. This theory is based on the following hypotheses. In the rest of the article, firstly we will briefly review the literature associated with capital structure, financing methods, informational asymmetry and representation costs, the method of measuring variables and classification of companies into optimal and non-optimal structure is expressed. We review the research hypotheses by using the multivariate regression equations
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