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21. Cost of Preference Capital can be obtained by
KP = E – P/2/D – E/100 (1 - Tax)
KP = E – P/2/D + 1/100 x 100
KP = D + 1/2 x 100
KP = D + (M.V. - N.P./n)/(M.V. + N.P./2)
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22. Assertion (A): High capital gearing leads to greater speculation. Reason (R): The proportion of equity share capital in relation to the total capital comprising the other securities is small leading to capitalization being highly geared.
Both A and R are true and R is the correct explanation of A
Both A and R are true but R is not a correct explanation of A
A is true but R is false
A is false but R is true
23. Capital budgeting actually the process of making investment decisions in
Sales Planning
Production process and style
Fixed Assets
Current Assets
24. According to the concept of financial signaling, management behavior results in new debt issues being regarded as "____ news" by investors.
good
bad
non-event
risk-neutral
25. Factoring is a
Financial Planning
Production Plan
Cost of Sales
New Financial Service
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