COMMERCESTUDYGUIDE

Cost of debt refers to the cost which a company has to bear for using fixed interest bearing securities such as debentures, long-term loans and bonds etc. it is mainly associated with debenture. It has two types Cost of redeemable debt or perpetual debt: perpetual debt refers to issue of debentures which will not be redeemed during the lifetime of Read More …

Businesses acquire funds from market in various forms. These generally include Equity shares, preference share, debentures and long-term loans. The company after acquiring funds from investors, invests those funds in various projects. The investor who contributes funds in any form expects some returns on their contribution. The company must earn a certain rate of return that satisfies their investors expectation. Read More …