Nisha sharma Asked a Question
October 18, 2021 5:35 pmpts 30 pts
(1-T) R-(MV-NP x 100 K (after tax)= or MV+NNP Cost of Irredeemable or Perpetual Debt R K (after tax)= ; 1-T) NP where K, = Cost of Debt R Interest NP Net Proceeds T Tax Rate For Example A company issues 12% debentures of Rs. 5,00,000 repayable after 10 years at a discount of 4% and incurs RRs. 10,000 for underwriting, brokerage etc., then, the cost of debt capital will be 0 o00+ Rs. 5,00, 000- Rs. 4,70,000 000 100.
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  • Priya sarda
    The measurement of the cost of perpetual debt is conceptually relative easy. It is the rate of return which the lenders expect. The debt carries a certain rate of inter The coupon ...
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  • Rucha rajesh shingvekar thankyou
    see attachment
    • cropped3319678796251233876.jpg
    • cropped6309457547081987861.jpg
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