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How to measure the cost of capital?

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Question added by Dasarathi Rath , Sr. Accountant , Al Luban Special Investment LLC
Date Posted: 2016/04/04
Ahmed Siddiq
by Ahmed Siddiq , Senior Associate , Fin-eX Outsourcing

Different ways to calculate it through wacc and capm.

Abdelfattah mohamed hassan Abdelhafez
by Abdelfattah mohamed hassan Abdelhafez , مدير عام ببنك القاهرة بالمعاش حاليا , بنك القاهرة - المركز الرئيسي

 

:The cost calculation for equity or return them as follows

Property rights / total investment or total funding "shares + securities + loans

 

 

thanks for the invitation

I apologized for errors in translation 

Renu Jajoo
by Renu Jajoo , Finance Manager , Pyramid Pharma Limited

To measure the cost of capital we must consider few factors:

1. Cost of equity and cost of debt

2. Prevailing interest rates

3. We  should consider internal rate of return   for the capital employed

4. Processing (arrangement fee) and sometimes its important to see prior payment charges as well.

5. Opportunity cost for the capital.

Mohammad Iqbal Abubaker
by Mohammad Iqbal Abubaker , Jahaca Pty Ltd - Accounts Administrator , Jahaca Pty Ltd - Accounts Administrator

i AGREE WITH THE Answer added by: Renu Jajoo   Finance Manager 29 days ago

 

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