A company issued 1000 10% debentures of ₹100 each at par and spent 3% on account of floatation cost and commission to brokers. These debentures are redeemable at 5% premium at the end of 5 years. If the company falls in
CS Executive · Financial and Strategic Management · PYQS · December 2022
A company issued 1000 10% debentures of ₹100 each at par and spent 3% on account of floatation cost and commission to brokers. These debentures are redeemable at 5% premium at the end of 5 years. If the company falls in 30% tax bracket, the effective cost of debentures is : (A) 10% (B) 7.35% (C) 8.04% (D) 10.5%
Answer & Explanation:
The official key records '*'. This question is excluded from automatic grading because the source does not supply an unambiguous valid choice. Official source note: *The options for these question are incorrect as some information in these question are either missi ng or incomplete. Hence candidates may be awarded marks whether they attempted these questions or not.
Topics: Financial Management
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