[Dinh]

Dear John,

Very clear. Thanks so much.

Rgds,
DT

[Dinh]

Hi Ken,

Sorry i still can not understand this non-capital leases. Below is the questions:

– I agree when economic depreciation is equal to depreciation in the income statements, we don’t need to make any adjustment to the NOPAT however is there any example for lease in real life that is not subject to amortisation?
– In the question, we know the leases valued at $16m in each of the years 20×5 to 20×7. So under the finance lease accounting the value of this lease asset should be 48m (16m x 3 years) by early 20×5, 32m by early 20×6 and 16m by early 20×7. So when i calculate EVA for this question, I will adjust add 32m to capital employed of 20×6 and 16m to CE of 20×7. This is different from the solution in the revision kit. Please help to explain why they add 16m in 20×6 and 20×7 when they calculate the CE.

Thanks,
DT

[Dinh]

Thank Ken

[Dinh]

Hi Ken,

For this lease, I am a bit confused. I understand the figure of 16m was not recorded in both PL and BS so we have to add back this 16m to the capital employed. Is it correct?

For the NOPAT, the depreciation (under Finance lease) is not given. If in the exam i assume the economic depreciation to be equal to 16m and add it to the NOPAT, is it ok? and could i get mark for this question?

THanks,
DT

[Dinh]

Thanks John

[Dinh]

Thank John & Binh. Last question for Binh. Are you in HCMC or HN?

[Dinh]

Dear John, i am still not clear. If the quote already include risk premium, why do we still minus 0.2% in Awan question? Thanks

[Dinh]

Thanks so much.

[Dinh]

thanks

[Dinh]

Thanks John however i am still confused. Debt also carries the risk.

[Dinh]

Thanks Sir. I understand to add back the proceeds from sales on the JV and how about the decrease/increase in short term deposits and repayment of secured loan? we don’t consider it because of same reason (not recurring transactions) or any other reason?
Thanks,
DT

[Dinh]

Thanks so much

[Dinh]

thanks

[Dinh]

Dear Sir,

I have below questions for Blipton International:

– When we calculate the terminal value of hotel (6,200 x 1.08^5 – 1,200) = 7,910 in the year 20×9, why don’t we consider the tax impact? In real life, when we dispose assets, we record the gain in the other income and this income is always subject to corporate income tax.
– In this question, we distinguish between cf from investment phase and return phase. The tax savings is positive cf which is recorded in the investment phase however the terminal value of hotel (also positive cf) is recorded in the return phase. This is important for MIRR calculation. so why do we record tax savings and terminal value as above? and any specific rule to distinguish investment and return cf for MIRR?

Thanks

[Dinh]

thanks so much. Yes i will make question if any inthe ask tutor forum.

[Author]

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