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Leasing..

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CA-Final Student
801 Points Joined October 2017
Topic :-- Leasing

If interest rate on loan is 20%,
tax rate 35%,
& cost of capital if company is 16%

Then what will be discount rate for computing present value..??
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On 21 May 2018 at 08:26 Report
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KOLKATA
419 Points Joined February 2013
I also have the same query. I have found that in many questions they have taken 13% (after tax of 20%) as discount rate for calculating PV. But in some questions they have taken 16% also. I am also confused as which rate is to be taken for calculating lease rentals and discounting factor??
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On 21 May 2018 at 10:28
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Watch Mayank Kothari sir youtube video for the same

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On 21 May 2018 at 11:28
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207 Points Joined September 2017
you can take 16% as well as post tax loan rate
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On 21 May 2018 at 11:54
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CA-Final Student
801 Points Joined October 2017
yea...
I have got answer we can take either cost of capital or post tax loan rate..
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On 22 May 2018 at 18:09

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