EBIT of ABC Ltd. is ₹ 7,00,000. The company has 12% ₹ 25,00,000 debentures. The equity capitalization rate is 16%. Calculate the market value of the firm (₹) as per the Net Income (NI) approach. Ignore taxation.

CS Executive · Financial and Strategic Management · PYQS · June 2024
EBIT of ABC Ltd. is ₹ 7,00,000. The company has 12% ₹ 25,00,000 debentures. The equity capitalization rate is 16%. Calculate the market value of the firm (₹) as per the Net Income (NI) approach. Ignore taxation.
(A) 50,00,000
(B) 58,75,000
(C) 47,95,000
(D) 57,85,000

Answer & Explanation:

Correct Answer: Option (A)

Official answer key: (A).

Topics: Financial Management

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