Firms A and B are identical with respect to their working except the difference in leverage. X
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Firms A and B are identical with respect to their working except the difference in leverage. X is an unleveraged firm and Y is a leveraged firm. Total capital invested in each of the company is ₹10,00,000; the debt and equity in Y is in equal ratio with rate of interest on debt 12%. EBIT of both of the firms is ₹2,00,000 with a tax rate of 30%. Calculate NOPAT and ROIC.
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Particulars EBIT Less Interest EBT Less Tax 30 EAT PAT NOPAT PAT Interest Invested Cap...View the full answer
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