Sir just wanted to confirm one thing that except for irredeemable loan notes we should only use before tax cost of debt to calculate mv of debt right?
Ask the Tutor ACCA FM
MV of loan note
9y ago#1Always (including irredeemable loan notes - they are not an exception), the market value is determined by the investors and so we discount the before tax interest and redemption amount by the before tax investors required rate of return.
Oh okay. I get it now.
Thank you.
9y ago#3You are welcome :-)
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