sir,
For calculation of PV of tax shield on interest,
in Kaplan text book it was said that , all financing cash flows are low risk they are discounted at either
- k(d) or
- risk free rate
my question is does this K(d) indicate rate of normal borrowing or subsidised loan????
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Adjusted present value
8y ago#1Normal rate (pre-tax, of course).
December 2006 Tampem Inc, Requirement a
Sir,
In calculation of tax saving on tax allowable depreciation, in 4th year (which is last year) examiner have calculated TAD based on "applying 25% on WDV" but shouldn't it be calculated by "deducting realisable value from WDV"
Can you please check this out and explain me the reason????
8y ago#3It is because of note (ix) in the question - it says that the value is after tax as a continuing operation. So the investment is not actually being sold (it is a continuing operation) and the amount is after any tax implications.
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