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WACC is derived by finding a firm's cost of equity & cost of debt & averaging them according to the market value of each sources. a. True b. false

WACC (weighed average cost of capital) is derived by finding a firm's cost of equity & cost of debt & averaging them according to the market value of each sources. a. True b. false

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تم إضافة السؤال من قبل Muhammad Zubair , CFO / Chief Accountant , RH Group
تاريخ النشر: 2014/04/20
mohammed ismail
من قبل mohammed ismail , Group Accounting Manager , AMS Holding Group

a.true

Mohammad Ibrahim, CMA, CertIFR
من قبل Mohammad Ibrahim, CMA, CertIFR , Accounting Operation Team Leader , KFH ( Kuwait Finance House )

Answer ( A ) is correct .

W.A.C.C : is a firm's cost of :

1- cost of debt Financing .( Cheapest Because Of Tax Deductability ). 

2- Cost of Preferred Stocks .

3- Cost Of Equity ( Common Stocks & Retained Earnings ) .

averaging them according to the market value of each sources.

True!

WACC = Cost of debt + cost of equity

Kindly note debt is tax free and equity is not.

Zeeshan Ehtisham
من قبل Zeeshan Ehtisham , Head of FP&A and Business Control , Tanmiah Food Group

True

Sahar Alech
من قبل Sahar Alech , Auditor / Financial Manager , Accounting Services Office

Averaging cost of debt and cost of equity Is WACC

naveena madhur vamana
من قبل naveena madhur vamana , sr engineer , Tech Mahindra LTD

Weighted average cost of capital is main thing has decide and as per customer requirement,So answer is 'Yes'.

هل تحتاج لمساعدة في كتابة سيرة ذاتية تحتوي على الكلمات الدلالية التي يبحث عنها أصحاب العمل؟