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Methodical Approaches to Managing Operation Costs of Companies With the Aim to Prevent Bankruptcy


  • Puriy Anna V.

    () (Kryvyi Rih Metallurgical Institute of Kryvyi Rih National University)


The article studies the modern state of methodical foundations of management of operation costs of a company and establishes that the company's bankruptcy risk is connected not only with the financial state, but also with efficiency of operation activity, which is reflected through interconnection of bankruptcy probability with the ratio of operation leverage and correlation of the borrowed and own capital at mining and smelting enterprises. It takes into account that increase of values of the operation leverage ratio results in increase of the bankruptcy risk. It identifies boundary fields of the bankruptcy risk of the mining and smelting enterprises by values of the operation leverage ratio within medium, restrained and critical risk of bankruptcy.

Suggested Citation

  • Puriy Anna V., 2013. "Methodical Approaches to Managing Operation Costs of Companies With the Aim to Prevent Bankruptcy," Business Inform, RESEARCH CENTRE FOR INDUSTRIAL DEVELOPMENT PROBLEMS of NAS (KHARKIV, UKRAINE), Kharkiv National University of Economics, issue 5, pages 293-298.
  • Handle: RePEc:idp:bizinf:y:2013:i:5:p:293_298

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    References listed on IDEAS

    1. Christopher A. Hennessy & Toni M. Whited, 2007. "How Costly Is External Financing? Evidence from a Structural Estimation," Journal of Finance, American Finance Association, vol. 62(4), pages 1705-1745, August.
    2. Blandina Oliveira & Adelino Fortunato, 2006. "Firm Growth and Liquidity Constraints: A Dynamic Analysis," Small Business Economics, Springer, vol. 27(2), pages 139-156, October.
    3. Rajan, Raghuram G & Zingales, Luigi, 1998. "Financial Dependence and Growth," American Economic Review, American Economic Association, vol. 88(3), pages 559-586, June.
    4. Heitor Almeida & Murillo Campello & Michael S. Weisbach, 2004. "The Cash Flow Sensitivity of Cash," Journal of Finance, American Finance Association, vol. 59(4), pages 1777-1804, August.
    5. John Hutchinson & Ana Xavier, 2006. "Comparing the Impact of Credit Constraints on the Growth of SMEs in a Transition Country with an Established Market Economy," Small Business Economics, Springer, vol. 27(2), pages 169-179, October.
    6. Stijn Claessens & Simeon Djankov & Joseph P. H. Fan & Larry H. P. Lang, 2002. "Disentangling the Incentive and Entrenchment Effects of Large Shareholdings," Journal of Finance, American Finance Association, vol. 57(6), pages 2741-2771, December.
    7. Giorgio Fagiolo & Alessandra Luzzi, 2006. "Do liquidity constraints matter in explaining firm size and growth? Some evidence from the Italian manufacturing industry," Industrial and Corporate Change, Oxford University Press, vol. 15(1), pages 1-39, February.
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