Why Cost of Debt is different in WACC ? When you pay interest on one side, on the other side you save tax due to interest (because your profits gets reduced to the extent of interest). Lets say, your profit before tax is 100 Mn and if you are paying interest of 30Mn (10% of 300Mn Loan), then your pr...
Fund flow statement is basically prepared to know what caused changes in financial position between two accounting periods.It analyses what are the reasons for the changes. so the focus is what and why of changes whereas cash flow statement will ascertain what caused changes in cash and cash equival...
Let's say your company has taken up a big project and it has approached financial institution for a long term loan and let's say that loan also has been sanctioned but Financial institution is taking time for finalising its procedures related to security creation Or tie up with other institutions. H...
We know most of the business entities makes credit sale and they have to do credit investigation before making credit sales, then maintain various documents related to the sales, They should follow up with the customers on due date for payment. These additional work will take significant time of man...
What is Fund flow analysis? Let us have a look at this - we know traditionally balance sheet and profit and loss statements are prepared - Balance sheet would communicate what is the financial position as on a particular date and profit and loss statement would communicate what is the book profits t...