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When working out EVA, should the WACC be the post or previous tax cost of debt?
In “International Enterprises 12/07 the comments say it was reduced incorrectly but then reduces it in the works. I the Bpp text it has am example using pretty tax rate?
Also in International enterprise question, the debt/(debt plus equity) ratio to calc wacc takes the book value for Debt of 45k and the MV of shares as debt plus equity. Is this a mistake or am I missing something?
The examiner is removing EVA from the P4 syllabus and so I really would not worry too much about it for this week 🙂
Thanks. Any tips for last minute revision? Only habe a have a couple of Hours tonight and Thursday after tax paper.
If you have not watched them, then maybe watch my free lectures working through a few recent Question 1’s from the exams.
Obviously you need to be able to do well in question 1, and my lectures talk about the approach as well as the technical content.
They are linked from the main P4 page (revision and past questions).
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