Compuvac Company has just completed its first pass forecast using the projected statement of financial position method.The firm has determined that it needs R4 million in new debt which can be sold at par with a 10% annual coupon.Additionally, the firm will sell 500,000 shares of new ordinary equity at R18.10 per share.Next year's expected dividend is R0.48 per share.The firm expects that taxes will be R160,000 less under the second pass than they were under the first pass based on a 40% tax rate.Given this information, what is the incremental change in AFN for Compuvac going from the first pass to the second pass?

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The Answer of Compuvac Company has just completed its first pass forecast using the projected statement of financial position method.The firm has determined that it needs R4 million in new debt which can be sold at par with a 10% annual coupon.Additionally, the firm will sell 500,000 shares of new ordinary equity at R18.10 per share.Next year's expected dividend is R0.48 per share.The firm expects that taxes will be R160,000 less under the second pass than they were under the first pass based on a 40% tax rate.Given this information, what is the incremental change in AFN for Compuvac going from the first pass to the second pass?

Compuvac Company Has Just Completed Its First Pass Forecast Using