CAPITAL STRUCTURE PRACTICES AND PROFITABILITY OF CONSUMER GOODS MANUFACTURING FIRM IN NIGERIA

Abstract

Capital structure is about putting in place the structure, mechanism and processes that may ensure the firm is directed and managed in a way that enhances long-term equity value through accountability of managers and enhancing organizational performance. Capital structure refers to a set rules and incentives by which the management of a company is directed and controlled. Hence, sound capital structure will have effect on profitability and long-term value of the firm for shareholders. However, the study recommends that management of Nigeria listed consumer goods firms should work hard to optimize the capital structure of their firms in order to increase the profitability of the firm and enhance firm’s value.