Question

g An important aspect of a​ firm's reorganization plan is the recapitalization of the​ firm's capital structure. The goal of restructuring a​ firm's debt includes​ ________. A. reducing the fixed minus payment obligations B. exchanging equity for debts C. decreasing the times interest earned ratio D. paying off existing debts

Answer 1

decreasing the times interest earned ratio.

Step-by-step explanation:

Recapitalization can be defined as a type of financial strategy which involves a change in the structure of an organization's capital. This strategy is used when an organization faces some challenges such as an enormous drop in the company shares.

Recapitalization is achieved by bringing about a change in the debt/equity ratio of the company. Recapitalization is very essential when a business plans to enter into a new segment of the market by the provision of additional funds.