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Calculate for company A,B and C using the formula of MM Proposition I with tax (Vl = Vu + Tc x B), two possible scenarios:
Calculate for company A,B and C using the formula of MM Proposition I with tax (Vl = Vu + Tc x B), two possible scenarios: 30% Equity - 70% Leverage, and 70% Equity - 30% Leverage. Remember that Vu = EBIT x (1 - Tc) / Ro and Ro = Rs. Company A - Rs is -1.18% and Tc is 21%. Company B - Rs is 0.92% and Tc is 21%. Company C - Rs is 0.83% and Tc is 21%. Company A is Tesla, Company B is Warner Bros and Company C is Amazon. So from the Income statement EBIT for company A is 6,714, company B is 2,066 and company C is 39,960.
Calculate for company A,B and C using the formula of MM Proposition I with tax (Vl = Vu + Tc x B), two possible scenarios: 30% Equity - 70% Leverage, and 70% Equity - 30% Leverage. Remember that Vu = EBIT x (1 - Tc) / Ro and Ro = Rs.
Company A - Rs is -1.18% and Tc is 21%.
Company B - Rs is 0.92% and Tc is 21%.
Company C - Rs is 0.83% and Tc is 21%.
Company A is Tesla, Company B is Warner Bros and Company C is Amazon. So from the Income statement EBIT for company A is 6,714, company B is 2,066 and company C is 39,960.
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