Question
In: Finance
A company has 14 million shares of common stock outstanding with a beta of 1.15 and...
A
company has 14 million shares of common stock outstanding with a
beta of 1.15 and a market price of $45 a share. There are 1000000
shares of 9 percent preferred stock outstanding valued at $80 a
share. The 10 percent semi annual coupon bonds have a face value of
$1000 and are selling at 92 percent of par. There are 280,000 bonds
outstanding that mature in 15 years. The market risk premium is 12
percent., T-bills are yielding 4.5 percent, and the firms tax rate
is 21 percent. Complete the weighted average cost of capital of the
company.
Solutions
jeff jeffy answered 3 years agoRelated Solutions
A company has 14 million shares of common stock outstanding with a beta of 1.15 and...
A company has 14 million shares of common stock outstanding with
a beta of 1.15 and a market price of $45 a share. There are
1,000,000 shares of 9 percent preferred stock outstanding valued at
$80 a share. The 10 percent semiannual coupon bonds have a face
value of $1,000 and are selling at 92 percent of par. There are
280,000 bonds outstanding that mature in 15 years. The market risk
premium is 12 percent, T-bills are yielding 4.5 percent,...
titan mining corporation has 14 million shares of common stock outstanding 900,000 shares of 9 percent...
titan mining corporation has 14 million shares of common stock
outstanding 900,000 shares of 9 percent preferred stock outstanding
and 210,000 ten percent semiannual bonds outstanding, par value
$1,000 each. The common stock currently sells for $34 per share and
has a beta of 1.15, the preferred stock currently sell for $80 per
share, and the bonds have 17 years to maturity and sell for 91
percent of par. The market risk premium is 11.5 percent, T-bills
are yielding 7.5...
ABC Corporation has 14 million shares of common stock outstanding, 900,000 shares of 8 percent preferred...
ABC Corporation has 14 million shares of common stock
outstanding, 900,000 shares of 8 percent preferred stock
outstanding and 220,000 semiannual bonds outstanding with coupon
rate of 12% and par value of $1,000 each. The common stock
currently sells for $42 per share and has a beta of 1.20, the
preferred stock currently sells for $80 per share, and the bonds
have 17 years to maturity and sell for 119.92 percent of par. The
expected return on the market portfolio...
A company has 4.3 million shares of common stock outstanding and 85,000 bonds outstanding, par value...
A company has 4.3 million shares of common stock outstanding and
85,000 bonds outstanding, par value of $1,000 each. Each bond has a
6.8 percent annual coupon rate and the bonds have 23 years to
maturity and is now selling at $789.23. (Based on the current
price, its YTM is 9%) Coupon is paid annually. The common stock
currently sells for $58.00 per share and has a beta of
0.90. The market risk premium is 7 percent and Treasury
bills are...
Solar Shades has 8.8 million shares of common stock outstanding, 4.8 million shares of preferred stock...
Solar Shades has 8.8 million shares of common stock outstanding,
4.8 million shares of preferred stock outstanding, and 18 thousand
bonds. If the common shares are selling for $13.80 per share, the
preferred share are selling for $30.80 per share, and the bonds are
selling for 104.92 percent of par, what would be the weight used
for equity in the computation of Solar Shade's WACC?
Sports Corp has 11.8 million shares of common stock outstanding, 6.8 million shares of preferred stock...
Sports Corp has 11.8 million shares of common stock outstanding,
6.8 million shares of preferred stock outstanding, and 2.8 million
bonds. If the common shares are selling for $26.8 per share, the
preferred share are selling for $14.3 per share, and the bonds are
selling for 96.82 percent of par, what would be the weight used for
equity in the computation of Sports's WACC?
Fairyland Inc. has 4 million shares of common stock outstanding, 1 million shares of preferred stock...
Fairyland Inc. has 4 million shares of common stock outstanding,
1 million shares of preferred stock outstanding, and 200 thousand
bonds. The common shares are selling for $25 per share, the
preferred share are selling for $10 per share, and the bonds are
selling for 95 percent of their $1,000 par. (See P10-3 for formula
to calculate weights).
A. What would be the weight used for equity in the computation
of FarCry’s WACC?
B. What weight should you use for...
Town Beverage has 8 million shares of common stock outstanding, 6 million shares of preferred stock...
Town Beverage has 8 million shares of common stock outstanding,
6 million shares of preferred stock outstanding, and 5 thousand
bonds. If the common shares are selling for $20 per share, the
preferred shares are selling for $10 per share, and the bonds are
selling for 105 percent of par, what would be the weight used for
preferred stock in the computation of Town Beverage's WACC?
A. 26.64% B. 27.27% C. 29.85% D. 33.33% E. 42.84%
Echo Sound has 4...
OMG Inc. has 6 million shares of common stock outstanding, 5 million shares of preferred stock...
OMG Inc. has 6 million shares of common stock outstanding, 5
million shares of preferred stock outstanding, and 7,000 bonds.
Suppose the common shares sell for $17 per share, the preferred
shares sell for $16 per share, and the bonds sell for 108 percent
of par. What weight should you use for preferred stock in the
computation of OMG’s WACC? (Round your answer to 2 decimal
places.)
Sports Corp has 11.8 million shares of common stock outstanding, 6.8 million shares of preferred stock...
Sports Corp has 11.8 million shares of common stock outstanding,
6.8 million shares of preferred stock outstanding, and 2.8 million
bonds. If the common shares are selling for $26.8 per share, the
preferred shares are selling for $14.3 per share, and the bonds are
selling for 96.82 percent of par, what would be the weight used for
equity in the computation of Sports's WACC? 55.14% 10.12% 33.33%
11.26%
Par Value 1000
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