. Chapter 13 - If the firm has a 6% after tax cost of debt, a 12% cost of preferred stock, and an 14% cost of common stock, what is Craig Corporation's weighted cost of capital? Capital Structure Bonds $500,000 Preferred stock 200,000 Common stock 300,000 Total $1,000,000
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- You have collected the following information about a company: Source of capital Market value Book value After-tax cost Long-term debt 100,000 100,000 0.08 Preferred stock 60,000 72,000 0.11 Common stock 200,000 100,000 0.15 Total 360,000 272,000 What is the weighted average cost of capital using market values?Assume the following information about a firm's capital components: What is the firm's WACC? capital structure cost debt $20000 8% preferred stock $20000 11% common stock $60000 14% 12.2 % 12.05% 11.9% 11%QUESTION 1 a) The capital structure for the GEN-Z Berhad is provided here: Capital structure RM’000 Bond 4,000 Preferred Stock 3,000 Common Stock 13,000 The firm is in a 25% tax bracket and plans to maintain its capital structure in the future. If the firm has a 7% before-tax cost debt, a 12% cost of preferred stock, and a 16% cost of common stock, what is the firm’s weighted average cost of capital (WACC)? b) Are preferred stocks a smart investment choice compared to common stocks? Whyor why not? Note: question a,b clear ans no not step1 step 2,3 like that !!
- QUESTION 1 a) The capital structure for the GEN-Z Berhad is provided here: Capital structure RM'000 Bond 4,000 Preferred Stock 3,000 Common Stock 13,000 The firm is in a 25% tax bracket and plans to maintain its capital structure in the future. If the firm has a 7% before-tax cost debt, a 12% cost of preferred stock, and a 16% cost of common stock, what is the firm's weighted average cost of capital (WACC)? (4 marks) b) Are preferred stocks a smart investment choice compared to common stocks? Whyor why ww w w not? (3 marks)What is the weighted-average cost of capital for SKYE Corporation given the following information? Equity shares outstanding Stock price per share Yield to maturity on debt Book value of interest-bearing debt Coupon interest rate on debt. Interest rate on government bonds SKYE's equity beta Historical excess return on stocks Tax rate Note: Enter your answer to 1 decimal place. Weighted-average cost of capital % 1 million. $ 35 7.68% $14 million 9% 7% 0.75 7.0% 40%Global Technology's capital structure is as follows: Debt Preferred stock Common equity 15% 50 35 The aftertax cost of debt is 8.50 percent; the cost of preferred stock is 12.00 percent; and the cost of common equity (in the form of retained earnings) is 15.50 percent. Calculate the Global Technology's weighted cost of each source of capital and the weighted average cost of capital. Note: Do not round intermediate calculations. Input your answers as a percent rounded to 2 decimal places. Debt Preferred stock Common equity Weighted average cost of capital Weighted Cost % %
- What is the weighted-average cost of capital for SKYE Corporation given the following information? 1 million Equity shares outstanding. Stock price per share Yield to maturity on debt Book value of interest-bearing debt Coupon interest rate on debt Interest rate on government bonds SKYE's equity beta Historical excess return on stocks Tax rate Note: Enter your answer to 1 decimal place. Weighted-average cost of capital % $ 20 7.68% $11 million 98 3% 0.75 5.5% 45%Blazingame Inc.'s capital components have the following market values. Debt$34,030,000Preferred Stock16,500,000Common equity47,860,000 Calculate the firm's capital structure and show the weights that would be used for a weighted average cost of capital (WACC) computation. Round the values to the nearest dollar and the weights to three decimal places of percentage. Debt$ fill in the blank 1 Values Weights Debt $ _____ Preferred Stock ____ _____ Common Equity ____ _____ $ _____ _____Assume the following information about a firm's capital components: Debt= $20,000 at 8% preferred stock = $20,000 at 11% Common stock = $60,000 at 14% The firm's WACC is:
- 5. Company cost of capital (S9.2) You are given the following information for Golden Fleece Financial: Long-term debt outstanding: $300,000 Current yield to maturity (rdebt): Number of shares of common stock: Price per share: Book value per share: Expected rate of return on stock (requity): Calculate Golden Fleece's company cost of capital. 8% 10,000 $50 $25 15%Capital structure of the ABC PJSC is as follows: Equity share capital market value $ 200 million, dividend $ 4 , market price per share $88, dividend growth 4%. Bond $ 300 million, Yield to maturity 4% , tax rate 20% Calculate weighted average cost of capital.What is the weighted-average cost of capital for SKYE Corporation given the following information? Equity shares outstanding 1 million Stock price per share $ 35 Yield to maturity on debt 7.68% Book value of interest-bearing debt $14 million Coupon interest rate on debt 9% Interest rate on government bonds 7% SKYE’s equity beta 0.75 Historical excess return on stocks 7.0% Tax rate 40% Note: Enter your answer to 1 decimal place. Weighted-average cost of capital. %
