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Probir Banerjee has Published 468 Articles
![Probir Banerjee](https://www.tutorialspoint.com/assets/profiles/361851/profile/60_4084284-1627371511.png)
Probir Banerjee
194 Views
Equity cash flow is the amount of money a company can return to its investors after paying all the debt it acquired from the market. Also called free cash flows to equity, equity cash flows show the health of a company, as it contains the money that is left after ... Read More
![Probir Banerjee](https://www.tutorialspoint.com/assets/profiles/361851/profile/60_4084284-1627371511.png)
Probir Banerjee
228 Views
The Adjusted Present Value (APV) approach can handle both perpetual and uneven cash flows. It can be used in calculating the adjusted present value of a levered firm that has many financing effects. The APV approach divides the NPV into two basic parts −The first part includes the all-equity NPV, ... Read More
![Probir Banerjee](https://www.tutorialspoint.com/assets/profiles/361851/profile/60_4084284-1627371511.png)
Probir Banerjee
360 Views
A pure-equity or an unlevered firm obtains all its funds internally and does not require to obtain any debt from the market. In other words, pure-equity firms are debt-free. Therefore, in case of an investment, a pure-equity firm doesn’t have to pay any interest for the debt the company may ... Read More
![Probir Banerjee](https://www.tutorialspoint.com/assets/profiles/361851/profile/60_4084284-1627371511.png)
Probir Banerjee
480 Views
Asset cost of capital refers to the capital of a firm when the financing of a project is purely done by equity without any form of debt. It is the expected rate of return on the company's assets in a hypothetical debt-free method. Asset cost of capital is also known ... Read More
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Probir Banerjee
137 Views
Like Free Cash Flow (FCF) and Capital Cash Flow (CCF), Adjusted Present value (APV) is another way of evaluating an investment project. However, it is completely different from FCF and CCF approaches.FCF and CCF are primarily related to interest tax shields and they do not consider the various financing effects ... Read More
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Probir Banerjee
297 Views
What are Issue Costs?When companies raise money from the market, it needs to distribute securities in the market which requires the company to incur some cost. These one-time costs are called issue costs that have to be considered while the project begins. It is a preliminary cost all companies must ... Read More
![Probir Banerjee](https://www.tutorialspoint.com/assets/profiles/361851/profile/60_4084284-1627371511.png)
Probir Banerjee
2K+ Views
The levered cost of equity represents the risk components of the financial structure of a firm. To finance the projects of a firm, companies often need to resort to debt that is collected from the market. The market offers the debt by the resources of the investors.In case of levered ... Read More
![Probir Banerjee](https://www.tutorialspoint.com/assets/profiles/361851/profile/60_4084284-1627371511.png)
Probir Banerjee
145 Views
A balance sheet is made up of assets and liabilities and hence the balance sheet approach of evaluating a firm shows the values of the assets of a company.Book Value of Assets is the Minimum Value of a FirmWhen the values are un-adjusted, the balance sheet approach indicates the claims ... Read More
![Probir Banerjee](https://www.tutorialspoint.com/assets/profiles/361851/profile/60_4084284-1627371511.png)
Probir Banerjee
727 Views
The Free Cash Flow approach using WACC for the evaluation of investment projects has certain limitations −Cash Flow PatternsThe original WACC is based on an assumption that cash flow patterns are perpetual. In fact, there is no such behavior in case of cash flow patterns. However, WACC works in all ... Read More
![Probir Banerjee](https://www.tutorialspoint.com/assets/profiles/361851/profile/60_4084284-1627371511.png)
Probir Banerjee
930 Views
The Adjusted Present Value of a project takes the Net Present Value (NPV) of a project and adds this with the cost of debt, including financing effects, such as interest tax shield, issue costs, costs of distress, and subsidies etc. The APV is used instead of NPV for evaluating an ... Read More