The equity finance percentage in cell B55 is calculated based on the debt finance percentage entered in cell B53. The required return on equity (before taxation) should be entered in cell B56 and is effectively the cost of equity – this means that it is the required annual return on the capital invested to acquire the business which needs to be paid to the equity contributors.

CopyFinancial > The equity finance percentage in cell B55 is calculated based on the debt finance percentage entered in cell B53. The required return on equity (before taxation) should be entered in cell B56 and is effectively the cost of equity – this means that it is the required annual return on the capital invested to acquire the business which needs to be paid to the equity contributors.