Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Example of Debt Finance
An example:
Interest = 10% tax rate = 30%
The effective cost of debt (interest) = Interest rate (1 - T)
= 10%(1-0.30)
= 7%
Consider companies A and B
Company A B
Sh.'000' Sh.'000'
10% debt 1,000 -
Equity - 1,000
1,000 1,000
The tax rate is 30% and earnings previous interest and tax amount to Ksh.400,000. All earnings are paid out as dividends. Calculate payable via each firm.
EBIT 400 400
Less interest 10% x 1,000 (100) -
EBT 300 400
Less tax @ 30% (90) (120)
Dividends payable 210 280
Company A saves tax equal to Sh.30,000(120,000 - 90,000) since interest charges are tax permit able and reduce taxable income.
Stock Exchange Index or SEI Stock Exchange Index is a measure of relative changes in prices of stocks from one duration to another index. Nairobi Stock Exchange twenty (20) -
discuss the meaning and advantage of captive insurance
Financial Planning A financial manager along with present investment policies will be concerned along with how efficiently the company's funds are invested since it is from t
How is the channelling of funds from savers to spenders very important? The channelling of funds by savers to spenders is very significant for two purposes: • One, lender-sa
1. Using the variance-covariance matrix (∑) and the expected return vector (er) given in the appendix, calculate the set of weights that correspond to the portfolio that maximizes
What is Bond Rate It is interest rate received on the face value or the par value of the bond. If a company or government issues a 10-year bond with 100$ as face value and 1
Review the budget below and answer the questions following the budget. FINANCIAL ACCOUNTING—STATEMENT OF REVENUE AND EXPENSES Statement of Revenue and Expenses for Group Practice f
traditional financial management are concerned with raising funds and optimum utilisation.do you agree?explain.
1. Suppose company A expects to increase unit sales of i-phone by 15% per year for the next 5 years. If you currently sell 3 million i-phones in one year, how many phones do you ex
In order to value a debt security correctly, we must understand the terms and conditions of debt securities precisely. These terms define the contractual rights of the debt securit
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd