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Dear Sir,
Could you please explain to me the answers for Ve and Vd in Questiion 205?
Question 214, where is the (1-T) calculation for revised WACC?
Thank you very much.
Which edition of the Revision Kit are you using, because in my edition question 214 does not ask for a calculation of the WACC?
With regard to question 205, the BPP answer shows the workings for Ve and Vd.
The nominal value of the shares is 0.50 and so there are 400m shares. At a MV of $5.85 per share, the total MV is $2,340M.The nominal value of the loan notes is 200M. The MV is $103.50 per $100 nominal value, and so the total MV is 103.50/100 x 200M = $207M
Have you watched the free lectures on this? The lectures are a complete free course for Paper F9 and cover everything needed to be able to pass the exam well.
The revision kit is for exams in September /December 2017, March/June 2018.
Question 214 doesn’t ask for a revised WACC, but the answer with the revised WACC. I have worked out.
Thank you.
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