Sir, am not able to calculate this. Could you please help?

Q: Assume that the net income of a company is Rs. 50 Crores. Now, if the company raise Rs. 20 crores in debt at 15% interest per annum, what will be the new net income?

Q: Assume that the net income of a company is Rs. 50 Crores. Now, if the company raise Rs. 20 crores in debt at 15% interest per annum, what will be the new net income?

Jun 27 2012 04:14 PM

The Net Income is calculated as Revenue - COGS - Operating Expense - Interest Expense.

So new interest expense is 15% x 20 crores = 3 crores

So new net income = 50-3 = 47 crores

Does this make sense

Jun 29 2012 02:27 PM
So new interest expense is 15% x 20 crores = 3 crores

So new net income = 50-3 = 47 crores

Does this make sense