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1) Sir suppose there is a question to calculate wacc and we have calculated cost of equity, cost of bank loan, market value of equity, market value of loan notes, and market value of bank loan, but we have not calculated cost of debt i.e IRR because of shortage of time so here in this situation shall we assume or not any figure for cost IRR and then proceed to calculate wacc?
2) In Npv calculations shall we fix three zeros or not?
1. In Section C you get marks for each bit of workings.
2. I have no idea what you mean by three zeros!
I mean to say in sec C of paper (spreadsheet) is it necessary to fix 3 zeros in NpV questions at the top of the question like suppose sales fig is 80000000 and if we fix three zeros at the top of question then we will takes sales fig as 80000. But is it necessary to do like this or is it also fine to take whole sales fig of 80000000 in solution. In this case we are not fixing three zeros in solution.
Suppose I am unable to calculate after tax cost if debt (IRR) for any reason then while calculating Wacc can I assume any after after cost of debt (IRR) fig of my own?
3) And while calculating NPV as examiner use to show inflated selling price and total sales working separately, now as we would be doing npv on spreadsheet so their is no need to show this working seperately, correct?
This would automatically be in the formula e.g 30000*1.05^2 in this way. Correct?
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