Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Dividend yield plus growth in dividend method
When the dividends of the firm are predictable to grow at a constant rate and the dividend payout ratio is constant, this technique may be used for calculating the cost of equity shares.
Where, Ke = cost of Equity capital, D = Expected dividend per share, g = rate of growth in dividends, MP = Market price of equity shares and NP = Net proceeds per share
Illustration:
A Co. plans to issue 1000 new shares of Rs.100 each at par. The floatation costs are expected to be 5% of the share price. The co. pays a dividend of Rs.10 per share initially and the growth in dividends is expected to be 5%. (a) Compute the cost of new issue of equity shares. (b) If the current market price of an equity share is Rs.150, calculate the cost of existing equity share capital
Solution: (a) K = D + g = 10 + 5% = 15.53%
Our geologist, Rebecca Paulka, has estimated from the earlier exploration that the Malian prospects have a 30% likelihood of containing economic quantities of uranium ore, the Nige
What is the potential of having agency problems
QUESTION 1 [25 marks] Xelo Ltd, whose current sales consist of fixed operating costs of R140 000 and variable operating costs equal to 22% of sales, has made the following two sale
Additional Paid in Capital - Amounts paid for stock in excess of its PAR VALUE or STATEDVALUE. Furthermore, other amounts paid by stockholders and charged to EQUITY ACCOUNTS other
What is a marginal cost of capital schedule (MCC)? Is the schedule always a horizontal line? Explain. The marginal cost of capital schedule is a graphic representation of the
Default risk is the risk that arises when the issuer is not able to satisfy the terms and conditions of the obligation with respect to timely pa
Functions of Treasurer:- (1) Cash Management: - It comprises the managing of cash receipts and cash payments of the business. (2) Banking Relations: - It comprises operating
Diversification A strategy which tends to move into new products and new markets in which organisation is unfamiliar with. Related for example vertical forwar
DEFINITION OF FINANCIAL MANAGEMENT Financial Management is a stream concerned with the generation and allotment of scarce resources (generally funds) to the most proficient use
Hi can someone help me with my assignment also understand it in order for me to do the voice thread and answer all questions that might confront me.
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd