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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AFM Exams › Vogel co June 2014
Hi,
In the question its mentioned that the cash raised from disposal of dept C will be used to pay off other NCL and CL of tori co. If they had mentioned the interest rate and suppose it was only another bond, would we add interest saved on loan repaid to the earnings for P/E ratio of the combined company?
No, because the increase in the after tax earnings of $7M would presumably have taken into account any interest saving.
Oh okay thank you
You are welcome 🙂