Leverage effect

sivaram (Asst Mgr-Taxation) (6918 Points)

30 June 2015  

Dear All


can anyone help me in computing the favourable and adverse leverage effect with explanations


debt considered as debt  good will is 14

if debt is considered as capital goodwill is 5

is it favourable or adverse



if debt is used as debt goodwill is 10

if debt is used as capital goodwill is  (6.67)

Is it favourable oradverse?