Letter of Renunciation
Written notification through which a allottee-stockholder (shareholder) renounces or transfers to other stockholder(s) the securities allotted to him or her out of a new issue or a rights issue.
These letters of renunciation can be sold in the market, if the company’s shliares are sought after and the terms of the rights offer are attractive.
Leverage
In finance, leverage or leveraging refers to the use of debt to supplement investment.[1] Companies usually leverage to increase returns to stock, as this practice can maximize gains (and losses). The easy but high-risk increases in stock prices due to leveraging at US banks has been blamed for the unusually high rate of pay for top executives during the recent banking crisis, since gains in stock are often rewarded regardless of method.
In short it is company’s long – term debt in relation to equity in its CAPITAL STRUCTURE. The larger the long – term debt, the higher the leverage will be .
LIFO or Last In First Out
LIFO is an acronym for “last in, first out.” (Sometimes the term FILO (“first in, last out”) is used synonymously – more rarely it is called FISH, (first in, still here).) In LIFO accounting, a historical method of recording the value of inventory, a firm records the last units purchased as the first units sold. LIFO accounting is in contrast to the method FIFO accounting
Since opening inventory plus purchases during the year minus closing inventory equal cost of goods sold, in an inflationary situation the last costs reflected in the cost of goods sold will show lower gross profits, a higher cost of goods figure and a lower closing inventory.
Limit Order
The client gives the stockbroker a price limit above which he cannot buy or below that pricehe cannot sell. There will also be a time limit. In a sharply rising or falling market depending on the market condition such an order may result in no buying or selling.
Limited Liability
A privilege enjoyed by the shareholders of a limited company. If the company goes bankrupt and does not have enough assets to meet its obligations, the shareholders cannot be asked to pay for more. Their liability ends when they pay for their shares.
Liquidation
liquidation is the process by which a company (or part of a company) is brought to an end, and the assets and property of the company redistributed. Liquidation can also be referred to as winding-up or dissolution, although dissolution technically refers to the last stage of liquidation. The process of liquidation also arises when customs, an authority or agency in a country responsible for collecting and safeguarding customs duties, determines the final computation or ascertainment of the duties or drawback accruing on an entry.[1]
The winding up of the business of a company, either through bankruptcy or through a resolution passed by the shareholders when the purpose of the company has been fulfilled
Liquidation Payments
In the event of the liquidation of a company as a result of bankruptcy, creditors are paid in the following order of priority: 1. Court costs and lawyers’ expenses; 2. Outstanding wages of workers; 3. Outstanding taxes; 4. Secured loans and secured debentures; 5. Creditors, i.e., suppliers to the company; 6. Preference shareholders; and finally, 7. Equity shareholders, if anything is left at all, which is rare. However, the number of listed companies going into liquidation is few.
Liquidity Ratios
liquidit ratio is the measure of the solvency of a company and its ability to meet its debt obligations on time. Common liquidity ratios include the current ratio, the quick ratio and the operating cash flow ratio.