Capital structure

Financial Management

Sir can you explain the part B of the question I didn't understand how did the increase in EBIT is calculated .

Enuguru Sai Nithin

CA Final

★ 78K+

02-Jun-21 12:10

635

Answers (3)

The first best alternative is 3rd option. The next best option is the difference between the indifference point is 23.76 and the existing EBIT is 15.00. Therefore the required increase in EBIT is 8.76 (23.76-15.00)

ruchi lahoti

CA Inter

★ 27K+

03-Jun-21 11:01

ruchi lahoti

Can u please say how did 23.76 came ?

Thread Starter

Enuguru Sai Nithin

CA Final

★ 78K+

07-Jul-21 21:03

Thread Starter

Enuguru Sai Nithin

Can u please say how did 23.76 came ?

Pls check concept of indifference point videos - it is the point where EPS under alternative 1 & 3 are same

Sriram Somayajula

Admin

07-Jul-21 21:16