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Calculate overall cost of capital

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Reference no: EM132642317

Equity Capital Rs.@10/- per share Rs. 50,00,000

Preference Share 10% Rs. 45,00,000

Debentures 14% Rs. 75,00,000

Average dividend of last three years of Company was 35%.

Problem 1: Debentures and preference shares issued for 10 years with 5% floatation cost and will be redeemed at 10% premium. You are required to calculate overall cost of capital.

Reference no: EM132642317

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