Chapter 5: source and coverage limits

# Capital Structure source/model boundaries
Official chapter: https://resource.cdn.icai.org/87741bos-280825-ch5.pdf . Read NI/traditional/NOI, MM no-tax/tax/arbitrage, trade-off/pecking, capital principles and EBIT-EPS-MPS/BEP/indifference sections.
Material source conflict: page18 prints tax-model Ke=Keu+(Keu-Kd)*D/(D+S). Later page27 prints Ke=Keu+(Keu-Kd)*D*(1-t)/S and illustration10 reconciles that expression with equity earnings/value. Exercises explicitly state the latter internally consistent model. Do not silently merge them or claim a current official erratum/answer matching for page18.
NI fixed Ke/Kd, NOI fixed overall cost and perfect-market MM are distinct assumptions. No real-world maximum-debt/riskless arbitrage guarantee. Equal business risk, compatible personal/corporate borrowing/recourse, no frictions are supplied where required.
Permanent debt tD taxshield requires usable perpetual relief with appropriate discounting; finite shield uses dated discounted flows. Tax rates/deductibility and loss-refund capacity are exercise facts, not current-law conclusions. Preference dividends are after-tax/nondeductible as supplied.
EPS rank is not automatically MPS/wealth or cash solvency; constant P/E/full payout earnings-capitalisation assumptions explicit. Repurchase cash included in shareholder wealth. Same-share parallel cases distinguish no versus every admissible crossing. Piecewise loss taxes are not silently made linear. Finite option maxima not claimed global optimum. No trade, issue, repurchase or financing effect authorised by question terms.
Original indicative capped marking, not official reproduced answers. Private preparation, not live/full official bank. No G1/AuthFirestore/spend/ledger change.