Specimen exam 2016 Q 27Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FM Exams › Specimen exam 2016 Q 27This topic has 3 replies, 2 voices, and was last updated 8 years ago by John Moffat.Viewing 4 posts - 1 through 4 (of 4 total)AuthorPosts August 17, 2016 at 1:29 pm #333771 boma77MemberTopics: 70Replies: 97☆☆Dear Tutor,could you please help me why do we have to use the before – tax average cost of capital and not after – tax to calculate the equivalent annual cost ? August 17, 2016 at 3:11 pm #333783 John MoffatKeymasterTopics: 57Replies: 54655☆☆☆☆☆It is because the question says to ignore tax (and the answer states this as well in the first line) 🙂Usually we would use the after-tax cost of capital, but here the question tells you to ignore it. August 18, 2016 at 5:30 am #333858 boma77MemberTopics: 70Replies: 97☆☆Thank you very much for your quick reply. August 18, 2016 at 6:50 am #333884 John MoffatKeymasterTopics: 57Replies: 54655☆☆☆☆☆You are welcome 🙂AuthorPostsViewing 4 posts - 1 through 4 (of 4 total)You must be logged in to reply to this topic.Log In Username: Password: Keep me signed in Log In