Cost of equity

This query is : Open

Querist : Anonymous

Querist : Anonymous (Querist)

27 December 2011 sir,y is it that the dividend tax is considered while calculating the cost of pref shares but ignored while calculating cost of equity

CA Dileep Surya Kumar

CA Dileep Surya Kumar (Expert)
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28 December 2011 Preference and equity dividend includes dividend distribution tax suppose preference dividend RS.10 that includes dividend distribution tax. so while calculating cost ,10 is considered as dividend.

Company pays amount to the share holders after deducting dividend distribution tax.

Querist : Anonymous

Querist : Anonymous (Querist)

28 December 2011 sir suppose div is 10 and dt is 10 percent y do we consider cost of pref 11 and cost f equity 10

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