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Adjusted present value

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AFM Exams › Adjusted present value

  • This topic has 1 reply, 2 voices, and was last updated 7 years ago by John Moffat.
Viewing 2 posts - 1 through 2 (of 2 total)
  • Author
    Posts
  • August 1, 2018 at 5:25 am #465485
    richardscully
    Participant
    • Topics: 197
    • Replies: 145
    • ☆☆☆

    Dear Sir..

    Can you say why the tax relief of the amount between the interest paid and Ke is added and not the tax relief of the interest paid? The formula includes (1-t)(Kei -kg) Vd/Ve…..should it not simply be (1-t)Kd (Vd/Ve)?

    Regards

    August 1, 2018 at 8:25 am #465497
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54820
    • ☆☆☆☆☆

    I assume that you are referring to the MM Proposition 2 formula (which is not directly related to APV). The formula is given on the formula sheet, and you are not required to prove it!!

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Viewing 2 posts - 1 through 2 (of 2 total)
  • The topic ‘Adjusted present value’ is closed to new replies.

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