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Unformatted text preview: Cost of Asset Rs.30,000 Down Payment 25% Interest 12% p.a. Flat Rate Duration 3 years Payment In Monthly installments in Arrears Tax relevant Depreciation 25% Debt: Equity Ratio 4:1 Pre-tax Cost of Debt 20% Cost of Equity 24% Tax Rate 43% Net Salvage value after 3 years 10% of original cost Interest allocation SOYD method Find:-(a) NPV of HP plan, assuming interest tax. (b) Calculate ERI , using approximate formula....
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This note was uploaded on 01/28/2011 for the course FIN 315 taught by Professor Welker during the Spring '09 term at IUP.
- Spring '09