Since return on equity usually represents a primary source of income for the small business owner, achieving a satisfactory ROE should be a major goal for any small business. One way to improve ROE is through proper use of leverage and financial structure planning.
The purpose of this paper is to provide the small business manager with a simple method for evaluating alternative capital structures to improve potential returns and analyze the comparative financial risks.
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PatroneF.L., and DuBoisDonald. “Financial Ratio Analysis for the Small Firm.”Journal of Small Business Management, January, 1981.
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Van VoorhisKenneth R.“The DuPont Model Revisited: A Simplified Approach to Small Business.”Journal of Small Business Management, April, 1981.
