FIN 401 - WACC (Market Value of Debt) - Ryerson University

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  • Опубликовано: 8 сен 2024
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Комментарии • 51

  • @AllThingsMathematics
    @AllThingsMathematics  7 лет назад +36

    Hello everyone, at the 2:53 mark, the answer should be $4,000,000 instead of $400,000. RUclips won't allow me to put a note in the video so thought I'd add mention it in a public comment!

    • @dahadayib2433
      @dahadayib2433 5 лет назад

      AllThingsMathematics hi teacher would I be able to get note material via email. Many thanks

    • @ellie8782
      @ellie8782 4 года назад

      I was scrolling down to see if you mentioned this :)

  • @hsdcreative
    @hsdcreative 3 года назад +3

    I gotta find some time after my exams to watch your videos about finance education 😅! Awesome content bro

  • @fabioladjomo5620
    @fabioladjomo5620 6 лет назад +2

    thank you sooooooo much . i really had a tough time trying to figure out my slides. you are making these calculations very simple. and increasing my love for the subject. i am very grateful

  • @thatman9177
    @thatman9177 11 месяцев назад

    I love the way you broke this down I appreciate that.

  • @RashaandLife
    @RashaandLife 6 месяцев назад

    Your videos are great, so easy to understand. thank you so much

  • @khenth6545
    @khenth6545 3 года назад +1

    Your videos have been very helpful. I think I finally have a breakthrough in my class.

  • @khinesweoo3162
    @khinesweoo3162 2 года назад

    Thank you so much. You save my sleep in MBA journey.

  • @naturesbliss2903
    @naturesbliss2903 7 лет назад +1

    Thank you for your step by step instruction and explanation of each step; I am actually understanding this with the help of this video.

  • @LegendsOfWallstreet
    @LegendsOfWallstreet 2 года назад +1

    The problem is that very
    few firms have all their debt in the form of bonds outstanding. A best approach is to convert book value debt into market value debt: Treat the entire debt on the books as one coupon bond, with a coupon set equal to the interest expenses on all the debt and the maturity set equal to the face-value weighted average maturity of the debt, and then to value this coupon bond at the current cost of debt for the company. I dont remember the exact equations, and that is the process I am looking for, but I have not find it yet.

    • @nevadamarschke8052
      @nevadamarschke8052 2 года назад

      Perhaps this can help, ruclips.net/video/7VFe5lcPnnc/видео.html

  • @sofiastefani
    @sofiastefani 3 года назад +1

    Thank you! Your answer of 1106.59 is calculating the full 7% NOT 3.5%. So, now I'm confused.

  • @hassanmujtaba4878
    @hassanmujtaba4878 4 года назад +1

    Life saving video...Thanks :)

  • @agusspermata4600
    @agusspermata4600 Год назад +2

    Show manually without using calculator...how u get pv =1106.59
    I still confused...

  • @mnonelelidambuza5207
    @mnonelelidambuza5207 6 лет назад

    Big thanks from South Africa

  • @MxsSkate
    @MxsSkate 4 года назад +2

    For market value of debt, can't we just use the book value of the interest-bearing debt and the coupon rate of interest? I believe, this is a very close approximation since a rise in market interest rates results in a fall in the market price of the debt and the two factors tend to offset each other.

  • @jessicazhou8076
    @jessicazhou8076 5 лет назад +5

    at the 9:01 mark, how get the result of $1106.59 ? What's the equivalent ?

  • @nicholasmesa9795
    @nicholasmesa9795 3 года назад +2

    Hi, i like the show, How did you get PV=#1106.59?

  • @lilmoesk899
    @lilmoesk899 6 лет назад +1

    Great stuff, thank you!

  • @hansschonz2719
    @hansschonz2719 2 года назад

    Good video, helps a lot!

  • @joeeziashi2067
    @joeeziashi2067 3 года назад

    Thank you, its cleared.

  • @beckylee5208
    @beckylee5208 6 лет назад

    Thank you so much for making these videos~!!

  • @elplantivoro
    @elplantivoro 4 года назад +5

    How did he compute the PV=$1106.59 ?

  • @tanyamontrilojwong8309
    @tanyamontrilojwong8309 5 лет назад +3

    How can you get the present value of 1106.59. Which formula did you use? Can we compute by manually?

    • @JonesDawg
      @JonesDawg 5 лет назад

      You can get this value with bond pricing formula. You can compute this manually if you have the maturity, coupon rate, face value and yield to maturity. But the present value of a bond is given by the market.

  • @maksymilianzielinski3712
    @maksymilianzielinski3712 3 года назад

    Hey, how to count cost of debt if comany combine financing assets by bonds and loans, in other way when we dont know nothing about YTM about loans and cost of loans in %? Bonds we can get always from the internet but how to get data about loans and combine everything togheter?

  • @KrishanSingh-gz9op
    @KrishanSingh-gz9op 3 года назад

    But what if the company's debt is not bonds but bank loans? Then how to calculate market value of debt?

  • @abramriccardo9251
    @abramriccardo9251 5 лет назад

    about bond, due to the maturity date, aren't companies getting the principals while also receiving coupon semi annually, or all the principal are paid at the maturity date ?

  • @SuperRaikouz
    @SuperRaikouz 3 года назад

    What about a loan? What if the debt is just loans and not bonds?
    I've got a closing balance of loan debt on the balance sheet - £465,000,000 does that equals the market value of debt?

  • @KaDaMaHa
    @KaDaMaHa 3 года назад +1

    Legend

  • @ridwanolayiwola459
    @ridwanolayiwola459 5 лет назад

    I have a question, can anyone help me with it: an issue was for £100 million and had a coupon interest rate of
    7.46 percent. The entire issue was sold in 2012 in a private placement to two life insurance
    companies, and the issue will mature in 2043. what is the market value of this bond?

  • @CTcCaster
    @CTcCaster 4 года назад

    What if the company does not issue any bonds, how would I find market value of Debt?
    Ive been searching and havent found anywhere that show me ways to find market value of debt Withou the use of bonds

  • @ivankrouguer70
    @ivankrouguer70 5 лет назад

    hi great vid!!!! just one thing, where do you find the number and the price of the bond online?

  • @mudendalweendo3660
    @mudendalweendo3660 5 лет назад

    At 9:01, is there a formula one can use instead of using a financial calculator?

  • @danielwhite8477
    @danielwhite8477 6 лет назад +1

    How did you find the Price per Bond? 8:57

  • @welele9010
    @welele9010 5 лет назад

    Dammit, you're too good!!!

  • @imdirtydan1493
    @imdirtydan1493 7 лет назад +1

    At 4:16, how do you know that the face value per bond is 1000?

  • @fathimahasna9368
    @fathimahasna9368 3 года назад

    How did he compute the PV=$1106.59

  • @sandiletukani
    @sandiletukani 7 лет назад +1

    5000*800 = 4 000 000, that is 4 000 000 not 4 00 000... Nice stuff though

    • @AllThingsMathematics
      @AllThingsMathematics  7 лет назад +2

      ughhhhhhhhhh!!! thanks for the heads up lol didn't notice. Good that it's not as important of a part in the video. I'll try putting a note to let people know.

    • @sandiletukani
      @sandiletukani 7 лет назад

      AllThingsMathematics
      No problem man. Anyway, I've subscribed to your channel, your work is beautiful. It was just a minor mistake, don't worry.