A Study Of The Influence Of The Enterprise Debt Structure Upon The Debt Paying Ability

For modern enterprises, credit plays a more and more important role. Good business enterprise credit is very important for the survival and development of enterprises. Debt paying ability refers to the ability to repay the debt burden. Enterprises shall timely and fully repay the short and long term debt in the previous generation. If unable to repay their debts, enterprises will appear the credit crisis, which will bring negative influence to the enterprise survival and the development in the long-term. what is the reasonable debt structure? How should the enterprise debt structure be adjusted to reasonable? The corporate debt financing problems are theoretical problems either are realistic problems.The real estate industry has a large scale of liabilities and high debt levels. The industry occupies a very important position in the national economy. It is closely contact with people’s housing conditions. And it plays a very important role in the process of urbanization. What’s more, the real estate industry can promote economic development because of the long related industrial chain. So the study of the influence of the real estate industry debt structure upon the debt paying ability has an important realistic significance.This paper summarizes the research results about the debt structure and debt paying ability and points out some shortcomings of existing research. Then based on the existing research, I briefly introduced the classification of the debt structure, the significance of enterprise debt paying ability and the advantages and disadvantages of debt management. Then I briefly analyses the industry structure, liabilities and funding sources, laying a foundation for further research on Chinese listed real estate company’s debt structure and debt paying ability.After those theoretical analysis, I selected the listed Real Estate Company in Shanghai and Shenzhen before the end of2004. Remove the companies which does not meet the requirements. And finally select the annual data of115Real Estate Company from2005to2012. To quantify the debt paying ability, I selected seven indices including the current ratio, asset liability ratio, interest coverage ratio, long term debt and working capital ratio, inventory turnover ratio, accounts receivable turnover rate and turnover of current assets. And factor analysis was performed on them. Then I calculated the factor scores and finally get the comprehensive score of the debt paying ability. To make an empirical analysis of the impact of the debt structure of debt paying ability, I constructed4explanatory variables which are named DF, CF, SX and YJ. Debt paying ability index is regarded as the explanatory variable. Then I use the Panel Data Econometrics Model to analyze those variables.Empirical results show that:The debt structure of real estate industry have significant influence on the debt paying ability. The effects of amount of bank borrowings is maximum, which is followed by the level of the current liability and commercial credit. The effects of long term debt is minimum. What’s more, the variables and debt paying ability was negative correlation. At the end of this paper, I made several suggestions on how to optimize the debt structure to enhance debt paying ability.