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I)

Capital Structure
Equity Share Capital
Pref Shares
Debentures
Term Loan
Total

Rs
ATCC %
80,00,000
20
20,00,000
10
60,00,000
6
40,00,000
15
200,00,000

2)
Capital Structure
Equity Share Capital
Pref Shares
Retained Earnings

Rs
80,00,000
20,00,000
60,00,000

Total

1,60,000

3)
Capital Structure
Equity Share Capital
Pref Shares
Retained Earnings
Debentures
Total

Rs
40,00,000
10,00,000
30,00,000
20,00,000

ATCC %
17
6
5.2

ATCC %
15.6
10.5
15
4.5

Work out the WACC and compare which company is
having better WACC. Why?

000 60.8 3 13.5 17 6 5.000 20.5 1.2% 3) Capital Structure Equity Share Capital Pref Shares Retained Earnings Debentures Total WACC 12.75 1.000 200.00.00.2 40 10 30 20 ATCC % WACC % 15.00.000 20.00.00.60.95 100 11.9 12.6 6.00.000 .5 0.000 60.000 Proportion % ATCC % 50 12.24 10.000 Total 1.000 Proportion % 40 10 30 20 100 After Tax CC % % 20 10 6 15 8 1 1.00.000 40.000 30.69% Rs Proportion % 40.00.000 10.000 1.5 37.8 WACC = 13.2 WACC % 8.00.00.Capital Structure Rs Equity Share Capital Pref Shares Debentures Term Loan Total 80.5 4.00.00.69 WACC -11.05 15 4.5 0.8% 2) Capital Structure Equity Share Capital Pref Shares Retained Earnings Rs 80.000 20.00.00.