(a)
Use lines 49–57 and Table 1. Calculate:
- gearing ratio if all $60m is raised from long-term loans [3]
- dividend per share in 2018 if all $60m is raised by selling an additional 20m shares [3]
(b)[12]
Use your results from 4(a), Table 1 and the other information. Recommend to the Board of Directors which source of finance HH should use to obtain $60m. Justify your answer.