FINANCING DECISIONS OF MNC
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Interest on loans: INR 300 million
Earning before tax: INR 7,700 million
Tax at 33 percent: INR 2,541 million
Earnings after tax: INR 5,159 million
Principal repayment of loan: INR 2,500 million
Amount to be remitted to parent firm: INR 2,659 million
Amount received by the parent firm: USD 57.80 million
PV of cash flows at 10 percent: USD 52.55 million
NPV: USD 2.55 million
NPV for Partial Financing of the Project with USD Debt
Revenues: INR 10,000 million
Operating expenses: INR 2,000 million
Earning before tax: INR 8,000 million
Tax at 33 percent: INR 2,640 million
Earnings after tax: INR 5,360 million
Amount to be remitted to parent firm: INR 5,360 million
Amount received by the parent firm: USD 116.52 million
Interest ...