A company's earnings before interest and tax is Rs. 7 lakh. It pays 10% interest on...
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A company's earnings before interest and tax is Rs. 7 lakh. It pays 10% interest on its debt. Total investment of company is Rs. 50 lakh. (a) Advise company whenever it should include debt or equity to raise its capital. (b) Name the concept related to this. (c) Will the company's decision to raise funds from debt or equity will change if company's EBIT becomes 3 lakh. A company's earnings before interest and tax is Rs. 7 lakh. It pays 10% interest on its debt. Total investment of company is Rs. 50 lakh. (a) Advise company whenever it should include debt or equity to raise its capital. (b) Name the concept related to this. (c) Will the company's decision to raise funds from debt or equity will change if company's EBIT becomes 3 lakh.
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