1
Master of Accounting, Islamic Azad University of Khomein
2
Assistant Professor of Accounting, Islamic Azad University of Khomein
Abstract
The cost of capital is an important factor in managerial and financial decisions of companies that are expected to be affected by the stage of the life cycle in which the company. The aim of this paper is to reveal the relationship between the growth, maturity and decline of corporate life cycles and the cost of equity .In this regard, three hypotheses Proposed and a sample of 92 companies was elected by the judgmental elimination method for the period 2010 to 2013. Also, firm-years sample into life-cycle stages (GROWTH, MATURE and DECLINE), data of sample classified, by means of four variables of sales growth, capital expenditure, dividend ratio and age. To test the hypothesis, test procedures, estimates and assumptions of the model, panel data is used. Analysis of the results indicates that equity capital cost is declined for companies in mature and growth stage. Also, it was observed that companies in the decline stage incurred a higher cost of capital. Finally, the results shows that there is not a significant relationship in level of cost of equity by position change of companies from growth to mature stage
Ghobadi, B. and Hashemi, S. S. (2014). The Effect of Corporate Life cycle on Cost of Equity Capital of Listed Companies in Tehran Stock Exchange. New Researches on Accounting, 2(3), 108-124.
MLA
Ghobadi, B. , and Hashemi, S. S. . "The Effect of Corporate Life cycle on Cost of Equity Capital of Listed Companies in Tehran Stock Exchange", New Researches on Accounting, 2, 3, 2014, 108-124.
HARVARD
Ghobadi, B., Hashemi, S. S. (2014). 'The Effect of Corporate Life cycle on Cost of Equity Capital of Listed Companies in Tehran Stock Exchange', New Researches on Accounting, 2(3), pp. 108-124.
CHICAGO
B. Ghobadi and S. S. Hashemi, "The Effect of Corporate Life cycle on Cost of Equity Capital of Listed Companies in Tehran Stock Exchange," New Researches on Accounting, 2 3 (2014): 108-124,
VANCOUVER
Ghobadi, B., Hashemi, S. S. The Effect of Corporate Life cycle on Cost of Equity Capital of Listed Companies in Tehran Stock Exchange. New Researches on Accounting, 2014; 2(3): 108-124.