Question

"Y' Ltd, issued a new 10% debnetures of 1,000 face value to be redeemed after 10 years. Debentures have been issued at par. However, floatation costs amount to 4%. Find out the cost of capital?​

Answer 1

Answer:

y Ltd issued on =10%

*Fv =1000

redeemed for =10years

rate =4%

100%=1000

1%=10

10%=100

1100..

1%=11

40%=440

1100+440=1540 ruppes ..