Company X is considered to purchase another company. the company has 3 funding options: 1. To received
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Question:
Company X is considered to purchase another company. the company has 3 funding options:
1. To received bank credit 2. issued debentures for 25 years, the payments will start in the sixth year 3. issued up to 300 mil common stock Price estimated at 30
The options do not depend on each other.
What will this affect? On the assets / net profit? How will each of the options above affect EPS, DPS, WACC and TIE assuming each option is independent of the other and the rest of the data is the same? (before and after)
Expert Answer:
Answer Assuming each funding option is independent heres how they would affect the companys financia... View the full answer
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