Question
A Company expects a net income of Rs. 1,00,000. It has Rs. 2,50,000, 8% debentures. The equality capitalization rate of the company is 10%. Calculate
A Company expects a net income of Rs. 1,00,000. It has Rs. 2,50,000, 8% debentures.
The equality capitalization rate of the company is 10%. Calculate the value of
the firm and overall capitalization rate according to the net income approach
(ignoring income tax).
(b) If the debenture debts are increased to Rs. 4,00,000. What shall be the value of
the firm and the overall capitalization rate?
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Business Statistics A Decision Making Approach
Authors: David F. Groebner, Patrick W. Shannon, Phillip C. Fry
9th Edition
013302184X, 978-0133021844
