● 6. Companies X and Y are in the same risk class and identical in all respects except that company X uses debts while company Y does not. Levered company has `9,00,000 debentures carrying 10% rate of interest. Both companies earn 20% before interest on their total assets of `15,00,000. Assume perfect capital markets and capitalisation rate of 15% for all equity company.

(i) Compute the value of both the companies using NOI approach, and

(ii) Also calculate overall Cost of Capital for both the companies using NOI approach.