15 August, 2020

Strategic Financial Management - AF4S31

SECTION B

Capital Investment Appraisal

Report
To the Directors of AYR Co.

Registration Number: R1910D9456174

Course Code: AF4S31-V2-18378
Tutor: Dr. Bashkim Isufi
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Table of Content:
Contents…………………………………………………………….……………………………..……1
1.0 Introduction...………………………………………………………………………..…..…….…..2
1.01 Steps in the Investment Appraisal Decision Process……….………………….….2
1.0.1.0 Initial Outlay……………………………………….…………………………………...2
1.0.2.0 Annual Cash Flows………………………………………………………….………...3
1.0.3.0 Terminal Cash Flow……………………………………………………….…………..3
2.0 Investment Appraisal Techniques……………………….……………………………….……..3
2.1 Net Present Value (NPV)……………………………………………………...……………4
2.2 Internal Rate of Return (IRR).……………………….…………..........................…...…..4
2.3 Payback Period (PBP)………………………………..……………..…………....…….…..4
3.0 Analysis and Evaluation of Investment Options………………………...…..………………...4
3.1 Aspire Project………………………………………….……………………………………..5
3.2 Wolf Project………………………………………….……………………………………….5
3.3 Results Outcome…………………………………………………………………………….6
3.4 Interpretations………………………………………………………………………………..6
3.5 Recommendations and Conclusions……………… …………………………………….6
3.6 Other Factors for consideration…………………………………………………….……...6
4.0 Sources of Finance…………………………………………………..…………………….….…7
4.1 Description of Equity and Debt….……..…………………………………………...…......7
4.2 Cost of Each Source of Finance………..…………………………………………..……..7
4.3 Effect on Weighted Average Cost of Capital (WACC) …………………………...…….8
5.0 Impact on Potential and Current Stakeholders and Lenders………………..,...…..……….8
6.0 Appendix…. …………………………………………..,...…………….…………………….…..9
6.1 Calculation for Aspire Project……………………………....,...……...............................9
6.2 Calculation for Wolf Project………..……………………..,...…….................................13
7.0 References……………………………………………………………………………………....16

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1.0 Introduction:
Capital investment is a decision-making process for selecting, analysing, and evaluating long-
term investments. Organisations also make decisions concerning investments in the non-
current asset. The investment appraised usually requires a substantial initial investment, and it
is expected to produce returns to organisations for more than a year. Rutherford (2012) states
that “As major investments are risky and irreversible; capital budgeting is a crucial managerial
activity of firms.” Therefore, Organisations carry our series of steps at the appraisal level to
ascertain investment profitability.

1.0.1 Steps in the Investment Appraisal Decision Process:

Pontema Training (2018), identified the various steps in the investment decision process as
detailed in the figure 1.0 below.

Source: Pontema Training (2018) ‘Business Investment Appraisal Techniques’ [Online]

Available at: https://www.youtube.com/watch?v=57BY2dQfUVs (Accessed August 2020).
AYR Co., as a firm, has two attractive proposals to evaluate, and one is to be selected based on
which project is more viable than the other. Therefore, measuring the project benefits and costs
relevant to cash flows for AYR Co. will be done based on the following:

1.0.1.0 Initial Outlay:

This is the immediate cash outflows required by AYR Co. to start the nominated project.
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1.0.2.0 Annual Cash Flows:

Cash flows that occur throughout the useful life of the project. It evaluates and analyse cost
implications and benefits. For instance, decrease in maintenance cost in year 1-5 is a benefit for
AYR Company.

1.0.3.0 Terminal Cash Flow:

Cash flows that occurs only at the project’s termination. For instance, value of scraps if AYR Co.
decides to end the business and sell off the scraps.

2.0 Capital Investment Appraisal Techniques (CIAT) of AYR Company:

The two techniques used by AYR Company are discounted cash flow, which means that future
cash flow will be discounted into present value. The examples are discounted payback period,
Net present value, and internal rate of return techniques. The concept uses the time value of
money. In contrast, the second technique is non-discounted cash flow, which includes the future
amount to occur regardless of timing and the interest effect. The examples are the payback
period and accounting rate of return techniques (Learn accounting, 2019). Fig 2.0.1 below
shows the link between these techniques.

2.0.1 Fig 2.0 Capital investment appraisal technique

Source: Learn accounting (2019) ‘Capital Investment Appraisal’ [Online] Available at:
https://www.youtube.com/watch?v=hEkFq3y7Evk (Accessed August 2020).

Three main techniques that will only be discussed and analysed in this report for AYR Company
are the payback period, Net present value, and internal rate of return. pmtycoon (2015) agrees
that these techniques will help organisations make informed decisions when faced with
challenges concerning the financial viability and business justification of projects.

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2.1 Net Present Value (NPV):

It measures the present cash flow by a discounted sum of all cash flows received less with its
initial investment. To calculate AYR Co. NPV, we have to look at the relationship between future
value (FV) of money and present value (PV). FV=PV (1+K)n where FV=Future Value, PV=
Present Value, K=Discounted Rate, and n=Number of years. Therefore, Net present value=
Present value of cash inflow – Present value of cash outflows. (pmtycoon (2015). Negative NPV
will decrease the value of the firm. This suggests that the project is not financially viable.
However, if the NPV is positive, then it is accepted because it is financially profitable. Also, zero
results indicate that the firm’s value remains unchanged.

2.2 Internal Rate of Return (IRR):

IRR is the interest rate at which the net present value of a project or investment is equal to zero.
IRR is a discount rate at which NPV becomes zero. Duncan (2017) states that “IRR is strictly
defined and used only to determine whether a plant or project will be profitable enough to a
company (the Enterprise) to build it.” If IRR is higher than opportunity cost, then the NPV will
always be positive, and vice versa. The higher the rate of return the better for the project when
comparing between the two projects.

2.3 Payback Period (PBP):

Payback period measures the number of years AYR Co. anticipates to recover the initial
investment from the cash generated by the investment. It recognises that time is money. The
rule is; if the payback is less than the maximum time allowed, then invest in the project.
However, if it is higher than the maximum time allowed then, do not invest in the project
(Counttuts, 2019).

3.0 Analysis and Evaluation of Investment Options:

Aspire, and Wolf are the two projects that have the potential of increasing AYR Company’s
market share because the sum of $120,000 is already spent on market research to determine
market response to both projects. Therefore, Since AYR Co. can only fund one project at this
time, the company want to make an informed decision on which project to align with after the
report is submitted to the directors and decision taken. According to the available information,
the sum of $2,250,000 is the cost of plant and machinery for both projects, and it is payable
immediately the decision is taken. The period of project execution is also the same for both
projects.
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3.1 Aspire Project:

Part of the requirement of the Aspire Project is the consideration of selling off the machinery, at
scrap value of $375,000 at the end of five years. There is also $140,000 working capital to be
used immediately. This amount was released from the company’s retained profits with a
repayment plan to last to the end of the project. The cash inflow forecast in year one is
$650,000, with a 7.5% rate increase from subsequent years. Expected variable cost is $27,000
per annum and to rise at 6.75% per annum. The project has a capital allowance and will be
considered as cash inflows. However, capital allowances are deductions from taxable income,
according to Henry, (1985), who explained it as follows.
Capital allowances are given as a deduction from the taxable income in accordance with the
Capital Allowances Act, 1968. The allowances are given mainly to traders or self-employed
persons but can also be claimed by employees who are necessarily obliged to use capital
equipment during their employment. Normally, the allowances are given as deduction from
taxable income but in certain circumstances, they are given by means of tax repayment, for
example, on leased industrial buildings, leased plant, or agricultural buildings and patent rights.
The words plant and machinery are not statutorily defined and for this reason have been
defined by Case Law. Section 7 of the Capital Allowances Act, 1968, defines an industrial
building as a mill, factory, or warehouse attached to manufacture, buildings used for the trade of
catching fish, etc.
3.2 Project Wolf:
The expenditure of project wolf will not attract capital allowances. Nevertheless, it has a
constant annual cash flows of $955,000, which remains constant throughout the life of the
project. Cost of materials in year one will be $14,400 with annual inflation rise of 7.5% per
annum. Other expenses forecast is $18,000 in year one and will face depreciation of 7.5%
annually over the lifetime of the project.
AYR Corporation pays tax at the rate of 20%, and it is payable one year in arrears. In both
cases, the weighted average cost of capital is 10%, and unless otherwise stated, it is assumed
that cash flows occur at the end of the year to which they relate. Furthermore, a straight-line
method of depreciation at a rate of 20% is applied to all non-current assets. (USW-VLE, 2020).

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3.3 Results Outcome:

Detailed calculations of the table below is available in the Appendix section.

Calculation Techniques Aspire Projects Wolf Projects

Net Present Value (NPV) $409,559 $475,111
Internal Rate of Return (IRR) 16% 18%
Payback Period (PBP) 3 years 6 months 3 years 1 month
Source: University of South Wales VLE.

3.4 Interpretations:
Both projects have a useful net present value. However, Wolf project is more profitable than the
Aspire project. The weighted average cost of capital is 10% in both cases, and from our result,
Wolf has 18% Internal rate of return while that of Aspire is 16%. Furthermore, Wolf project has a
higher NPV of $475,111 as against Aspire with $409,559 NPV. Every investor seeks to invest in
a project with a faster return on investment (ROI). Wolf project, in this case, has a faster
turnaround time of 3.1 years than the Aspire project with a turnaround time of 3.6 years.

3.5 Recommendations and Conclusions:

After critical evaluation of the derived matrixes in the table above, which shows that the Wolf
project surpassed the Aspire project in every ramification and it is worth investing on, AYR
Corporation should invest in Wolf project. The reasons are as follows. Wolf project has a better
IRR, PBP and NPV. These are reasonable indications that Wolf project will generate more
financial returns for AYR Co. than the Aspire project. The justification for this is based on
analysis of the fig. 3.0 above.

3.6 Other Factors to Consider:

Aside from making a financial decision for the project, several non-financial factors have to be
considered by AYR Co. Company’s preparedness is very important in this case. It is envisaged
that this project will change the horizon of the company and as such appeal to a new set of
customers. The company may need to review many of its processes and workforce.
Organisational culture in terms of attitude to risk-taking and reward process for shareholders is
vital. A complete shift of focus to new business can render existing business unproductive with
time. Knowledge in technology about this new project, reviewing the impact of waste on the

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environment, risk and uncertainty are very vital because all investments decisions have some
uncertainty. According to tutor2u, (2019) “Changes in the external environment can change
investment returns. Contingency planning and sensitivity analysis can help businesses address
the problems created by uncertainty”. Government policies that may have impact on the
business, business expansion, market penetration strategy and competitions are no exception.

4.0 Sources of Financing:

Directors of AYR Co. know that it is essential to make adequate provision in terms of finance for
the project in view. Finance can be generated internally or externally. Internal sources are
retained profit from previous years after all deduction, sales of assets and more effective use of
capital, which includes negotiating a long time payment period with suppliers and reducing
payment periods from debtors. “Main sources of generating funds externally are loan capital,
venture capital, ordinary share capital, personal funding.” (Revision App - Student Blog, 2014).
These options of project financing are available for AYR Co. directors to explore. However, AYR
Co. directors currently finance their business using the two options, as stated in the table below.
Capital Employed $million
Equity Holder Funds 20
Long Term Debt 18
Total 38
Source: University of South Wales VLE.

4.1 Debt and Equity Financing:

AYR Co. sources of financing this project could only be from either debt or equity. However,
funding can be from both sources too. With these funds, AYR Co. can meet payroll obligations,
pay taxes, make purchases, amongst others. The basic accounting equation states that assets
equal liabilities plus owner’s equity. Debts are known as liabilities. It a long-term borrowing
provided by non-owners, meaning individuals or other firms and do not have an ownership
stake in the business. Debt financing commonly takes the form of taking out loans and selling
corporate bonds. Equity financing involves acquiring funds from owners, who are also known as
shareholders. It commonly involves the issuance of common stock in public and secondary
offerings or the use of retained earnings. (Alanis Business Academy, 2013).

4.2 Cost of Each Source of Finance:

AYR Co. directors have to consider different financing alternatives (i.e., short-term loans, long-
term loans, and lines of credit); before making a final decision. (Martynova and Renneboog,
2009 cited in Mario Fischer, 2017), states that sources of financing “are internal funds, equity
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issues, debt issues, and a combination of equity and debt issues.” Equity financing is not as
easy as debt financing, which is tax-deductible on interest paid. Reviewing the debt option is
instead an excellent decision to make than equity selection. Investors expect higher returns on
investment, and in situations where the firm could not meet up with such expectations,
shareholders lose money. It is, therefore, a significant risk by attempting to finance the project
solely on equity. The risk involved in financing the project with debt is low to AYR Co. because
the borrower takes the higher risk.

4.3 Effect on Weighted Average Cost of Capital (WACC):

The weighted average cost of capital (WACC) measures the total cost of capital to a firm.
Furthermore, Murray & Tao, (2016) claimed that the “weighted average cost of capital consists
partly of the cost of debt and partly of the cost of equity.” As earlier discussed, debt financing is
believed to be a better source of funding this project. However, due consultation with relevant
data and financial experts will further assist AYR Co. directors on which source of financing
should be used. Debt financing has the potential of reducing WACC compared to equity
financing. A change in capital structure alters WACC if the cost of debt is not equal to the cost of
equity capital. Therefore, the cost of equity is typically higher than the cost of debt. Therefore,
increasing equity financing usually increases WACC because of an increase in shares. AYR Co.
will pay 10% per annum as the cost of overall capital raised via a combination of debt and
equity as the weighted average cost of capital (WACC) as provided in the VLE, for the purpose
of this report.

5.0 Impact on Potential and Current Stakeholders and Lenders:

Equity financing according to Investopedia, (2019) argues that "raising money by selling new
shares of stock – has no impact on a firm's profitability, but it can dilute existing shareholders'
holdings because the company's net income is divided among a larger number of shares."
Existing shareholders will experience a reduction in dividends and interest payment. In
retrospect, debt financing principal has to be paid with interest to the lender. Therefore, interest
paid affects debt to reduce net income and cash flow. Financing project with debt often come
with rigid agreements, meaning there are specific debt level requirement and interest coverage
that must be agreed.

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6.0 Appendix:

6.1 Calculations for Aspire Project.

Cash Inflow:
Year Calculations Result
Year 1 $650,000 and to increase by 7.5% $650,000
annually.
Year 2 $650,000 +7.5% $698,750
Year 3 $698,750 +7.5% $751,156
Year 4 $751,156+7.5% $807,493
Year 5 $807,493 + 7.5% $868,055

Variable Cost:
Year Calculations Result
Year 1 $27,000 and to increase by 6.75% $27,000
annually.
Year 2 $27,000+6.75% $28,830
Year 3 $28,830+6.75% $30,776
Year 4 $30,776+6.75% $32,853
Year 5 $32,853+ 6.75% $35,071

Capital Allowances:
Year Result as Provided
Year 1 $600,000
Year 2 $390,000
Year 3 $345,000
Year 4 $300,000
Year 5 $240,000

Future Value of Working Capital: Calculated using the formula as FV=PV (1+K)n
Year Calculations Result
Year 1 Fv= 140,000 x (1+ 0.1)1 $154,000
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Year 2 Fv= 140,000 x (1+ 0.1)2 $169,400

Year 3 Fv= 140,000 x (1+ 0.1)3 $186,340
Year 4 Fv= 140,000 x (1+ 0.1)4 $204,974
Year 5 Fv= 140,000 x (1+ 0.1)5 $225,471

Net Cash Flows: Calculated using the Cash inflow (CI) + scrap value (SV) – variable cost
(VC)– future value of working capital (FVWC)
Year Calculations Result
Year 1 $650,000-$27,000 $623,000
Year 2 $698,750-$28,830 $669,920
Year 3 $751,156-$30,776 $720,380
Year 4 $807,493-$32,853 $774,640
Year 5 $868,055 + $375,000 - $35,071 - $225,471 $982,513

Taxable Cash Flows: Calculated using the Net Cash flow (CI) – capital Allowance (CA).
Year Calculations Result
Year 1 $623,000 - 600,000 $23,000
Year 2 $669,920 – 390,000 $279,920
Year 3 $720,380 – 345,000 $375,380
Year 4 $774,640 – 300,000 $474,640
Year 5 $982,513 – 240,000 $742,513

Taxes at 20%: This is calculated using the Net Cash flow (CI) – capital Allowance (CA).
Year Calculations Result
Year 1 Payment will be done the following year
Year 2 $23,000 x 20% $4,000
Year 3 $279,920 x 20% $55,984
Year 4 $375,380 x 20% $75,076
Year 5 $474,640 x 20% $94,928
Year 6 $742,513 x 20% $148,503

Discount Factor: Calculated using the formula as DF=1/(1+K)n (WACC) =10%=0.1

Year Calculations Result
Year 1 DF= 1/(1+ 0.1)1 0.90909
Year 2 DF =1/ (1+ 0.1)2 0.82645
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Year 3 DF = 1/(1+ 0.1)3 0.75131

Year 4 DF = 1/(1+ 0.1)4 0.68193
Year 5 DF = 1/(1+ 0.1)5 0.62092
Year 6 DF = 1/(1+ 0.1)6 0.56446

Present Value: Calculated by multiplying net cash flows with discount factor.
Year Calculations Result
Year 1 $623,000 x 0.90909 $566,363
Year 2 $669,920 x 0.82645 $553,655
Year 3 $720,380 x 0.75131 $541,229
Year 4 $774,640 x 0.68193 $528,250
Year 5 $982,513 x 0.62092 $610,062
Net Present Value: This is calculated as, Net present value (NPV)= Sum of Present value of
cash inflow (SPVCI)– Sum of Present value of cash outflows (SPVCO).

SPVCO= ∑(Cost of Plant and Machinery + Working Capital)

SPVCO= ($2,250,000 +$140,000= $2,390,000)

SPVCI= ∑($566,363 + $553,655 + $541,229 + $528,250 + $610,062) = $2,799,559

NPV= $2,799,559- $2,390,000 = $409,559. Alternatively, an Excel package was also used to
confirm the Net present value result. Which is ≈ $410,000

Net Present Value: At 10% Interest

Year Cash flow Present Value

Year 0 $ -2,390,000.00
Year 1 $ 623,000.00 $ 566,363.64
Year 2 $ 669,920.00 $ 553,652.89
Year 3 $ 720,380.00 $ 541,232.16
Year 4 $ 774,640.00 $ 529,089.54
Year 5 $ 982,513.00 $ 610,063.27
$ 2,800,401.50
Net Present Value $ 410,401.50
Internal Rate of Return

Calculation was done using an excel package to arrive at the result shown in the table below.

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Internal Rate of Return: at 16% Interest

Year Cash flow Present Value

Year 0 $ -2,390,000.00

Year 1 $ 623,000.00 $ 536,930.10

Year 2 $ 669,920.00 $ 497,602.28

Year 3 $ 720,380.00 $ 461,159.09

Year 4 $ 774,640.00 $ 427,384.48

Year 5 $ 982,513.00 $ 467,182.80

$ 2,390,258.75
Net Present Value $ 258.75
Internal Rate of Return 16%

Payback Period: The time taken to get the initial capital is referred to as payback period.
The inflows will be added up until we have the value of the initial capital of $2,390,000.00.
Year Cash flow Year 1 & 2 Year 1,2&3 Year 1,2,3&4 Result at
3.6years
1 $623,000.0
0
2 $669,920.0 $ 1,292,920 $ 2,013,300
0
3 $720,380.0 $ 2,733,680
0
4 $774,640.0 > Payback $ 64,553
0 Period
5 $982,513.0 Monthly $2,400,618
0 rate in year
four

It will take approximately 3years 6months less few days for payback according to the calculation
above.

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6.2 Calculations for Wolf Project.

 Capital Spending: Initial capital is $2,250,000.

 Cash Inflows: $955,000 It is the same from year 1 to year 5.
 Factory Space Rental Income (Forgone): It is the same from year 1 to year 5. And the
amount is $75,000.

Material Cost:
Year Calculations Result
Year 1 $14,400 and to increase by 7.5% $14,400
annually.
Year 2 $14,400+7.5% $15,480
Year 3 $15,480 +7.5% $16,641
Year 4 $16,641+7.5% $17,889
Year 5 $17,889+7.5% $19,231
Year 6 $19,231+ 7.5% $20,673

Other Expenses:
Year Calculations Result
Year 1 $18,000 and to decrease by 7.5% $18,000
annually.
Year 2 $18,000 -7.5% $16,650
Year 3 $16,650-7.5% $15,401
Year 4 $15,401-7.5% $14,246
Year 5 $14,246- 7.5% $13,178

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Earnings before Interest and Taxes (EBIT): This is calculated by subtracting Cash inflows
from the additions of material cost, other expenses and rental forgone.
Year Calculations Result
Year 1 $955,000- $14,400 +$18,000+$75,000 $847,600
Year 2 $955,000- $15,480 +$16,650+$75,000 $847,870
Year 3 $955,000- $16,641 +$15,401+$75,000 $847,958
Year 4 $955,000- $17,889 +$14,246+$75,000 $847,865
Year 5 $955,000- $19,231 +$13,178+$75,000 $847,591

Net Cash Flows: Subtracting Cash inflows from the additions of material cost, other expenses
and rental forgone.
Year Calculations Result
Year 1 $955,000- $14,400 -$18,000-$75,000-0 $847,600
Year 2 $955,000- $15,480 -$16,650-$75,000-$169,520 $678,350
Year 3 $955,000- $16,641 -$15,401-$75,000-$169,574 $678,384
Year 4 $955,000- $17,889 -$14,246-$75,000-$169,592 $678,273
Year 5 $955,000- $19,231 -$13,178-$75,000-$169,573 $678,018

Taxes at 20%: This is calculated with 20% of EBIT.

Year Calculations Result
Year 1 0
Year 2 $847,600 x 20% $169,520
Year 3 $847,870 x 20% $169,574
Year 4 $847,958 x 20% $169,592
Year 5 $847,865 x 20% $169,573
Year 6 $847,591 x 20% $169,518

Discount Factor: Calculated as DF=1/(1+K)n where (WACC) =10%=0.1

Year Calculations Result
Year 1 DF= 1/(1+ 0.1)1 0.90909
Year 2 DF =1/ (1+ 0.1)2 0.82645
Year 3 DF = 1/(1+ 0.1)3 0.75131
Year 4 DF = 1/(1+ 0.1)4 0.68193
Year 5 DF = 1/(1+ 0.1)5 0.62092

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Year 6 DF = 1/(1+ 0.1)6 0.56446

Net Present Value: at 10% Interest

Year Cash flow Present Value Discount Factor

$
Year 0
2,250,000.00
$
Year 1 $ 770,545.45 $ 0.91
847,600.00
$
Year 2 $ 560,619.83 $ 0.83
678,350.00
$
Year 3 $ 509,679.94 $ 0.75
678,384.00
$
Year 4 $ 463,269.59 $ 0.68
678,273.00
$
Year 5 $ 420,995.83 $ 0.62
678,018.00
$ 2,725,110.65
Net Present Value $ 475,110.65
Internal Rate of Return

Internal Rate of Return: IRR is 18%

Year Cash flow Present Value Discount Factor

$
Year 0
2,250,000.00
$
Year 1 $ 716,544.09 $ 0.85
847,600.00
$
Year 2 $ 484,794.59 $ 0.71
678,350.00
$
Year 3 $ 409,856.19 $ 0.60
678,384.00
$
Year 4 $ 346,427.53 $ 0.51
678,273.00
$
Year 5 $ 292,752.80 $ 0.43
678,018.00
$ 2,250,375.21
Net Present Value $ 375.21
Internal Rate of Return 18%
Payback Period: It will take approximately 3years and 1month less few days for payback
according to the calculation below.

Year Cash flow Year 1,2 & 3 Year 1,2,3&4 Result at

3.1years
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$ 2,250,000
1 $ 847,600.00
2 $ 678,350.00
3 $ 678,384.00 $ 2,204,334.00
4 $ 678,273.00 $ 2,882,607.00 $ 56,523
5 $ 678,018.00 Monthly $2,260,857
rate in year
four

References:
Counttuts (2019) ‘Payback Period| Explained with Examples’ [Online] Available at:
https://www.youtube.com/watch?v=lfyjasinZdY (Accessed 13th August 2020).

Donald Rutherford (2012) ‘Routledge Dictionary of Economics, p72’ [Online] Available at:
https://ebookcentral-proquest-com.ergo.southwales.ac.uk/lib/usw/reader.action?
docID=1244570&ppg=6# (Accessed 12th August 2020).
Duncan A.Mellichamp (2017) ‘Internal rate of return: Good and bad features, and a new way of
interpreting the historic measure’ Computers & Chemical Engineering Volume 106, Pages 396-
406 [Online] Available at:
https://www-sciencedirect-com.ergo.southwales.ac.uk/science/article/pii/S009813541730251X
(Accessed 14th August 2020).
Henry Toch BCom (2985) ‘7 - Capital Allowances’Income Tax Made Simple. 1985, Pages 89-
105 [Online] Available at: https://doi.org/10.1016/B978-0-434-98606-4.50012-0 (Accessed 13th
August 2020).
Investopedia, (2019) ‘The Impact of Financing’ CORPORATE FINANCE &
ACCOUNTING [Online] Available at: https://www.investopedia.com/ask/answers/051315/how-
does-equity-financing-affect-companys-financials-compared-effects-debt-financing.asp
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