OpenTuition | ACCA | CIMA
Free ACCA and CIMA on line courses | Free ACCA, CIMA, FIA Notes, Lectures, Tests and Forums
Sign up with YouTube premium to watch our lectures Ad-free and download them to watch offline.
Specially for OpenTuition students
May 13, 2021 at 10:48 pm
First of all thank you all the lecture of Fm are really good ?.
While going through this unit of business finance I have a question related to this. Which is as follow.
In the case of the premium on the redemption of debenture at what value we will calculate the premium if we have given the market value, face value or nominal value?
John Moffat says
May 14, 2021 at 8:46 am
The premium is always calculated on the nominal value.
January 28, 2021 at 2:30 pm
for example 12 at the end: how come we don’t consider the expected growth rate when we calculate the conversion premium?
January 28, 2021 at 4:45 pm
Because that is the way that the conversion premium is defined!
January 28, 2021 at 4:59 pm
Thank you 🙂
January 29, 2021 at 8:47 am
You are welcome 🙂
January 13, 2021 at 6:50 pm
Sir, in example 12 why do we take into account the interest for the year 2007? Is interest always paid at the year end?
July 27, 2020 at 7:25 pm
will you please explain how do we got to 3.605 discounted amount in Example 10
July 28, 2020 at 8:57 am
It is the 5 year annuity factor at 12%, read from the tables provided in the exam.
(Have you watched the earlier lectures on how to use the tables?)
June 14, 2020 at 12:16 pm
Hi, Sir can you please explain why we haven’t calculated the total debt value in Example 08 & 09. Calculation showing the total value of Debt ? i.e for P total value is $ 625,000 (5,000*125)
Is the answer is complete with giving value of Nominal $ 100 debt only ?
June 14, 2020 at 4:26 pm
Unless the question specifies different you can give the answer as the MV per unit or as the total capitalisation. (Section A and B questions will specify which)
June 18, 2020 at 9:42 pm
Example 12, Convertible debt, I believe there is a calculation error, i.e 8 x 2.487=18.90, should be 19.896
June 19, 2020 at 10:21 am
Yes – it is an error 🙁
I must re-record the lecture.
November 29, 2019 at 7:59 am
Hi, can you please tell there are some differences between Loan note and debenture?
November 29, 2019 at 8:10 am
They are the same – different names for the same thing 🙂
November 29, 2019 at 10:15 am
ok thanks 🙂
August 18, 2019 at 10:25 am
I got quite confused that, in the question the debentures are redeemed at par(I think that is $100), but in the working it is calculated with the expected share value (which is $110.23).
August 18, 2019 at 2:06 pm
The question says that the debentures are convertible to 20 shares. Debenture holders will currently be expecting to convert because they are expecting the value of 20 shares to be more than par/nominal (which the question says is $100). So the MV of the debentures will be as per the lecture. (I assume that you have downloaded the free course notes?)
August 19, 2019 at 9:16 am
Oh I think I understand now. Thank you, sir!
August 19, 2019 at 3:10 pm
November 24, 2018 at 6:17 pm
Sorry john I got 19.90 for the interest 1-3 discounted at the present value is that correct? Thank you
December 1, 2018 at 2:11 pm
You right. It was small error.
You must be logged in to post a comment.