axed at 25%. Amount Pre-tax Cost Bonds P 3,000,000 1,000,000 4,000,000 8% Preferred Shares 10% Drdinary Shares 15%
axed at 25%. Amount Pre-tax Cost Bonds P 3,000,000 1,000,000 4,000,000 8% Preferred Shares 10% Drdinary Shares 15%
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
REQUIREMENT:
1. How much is the weighted average cost of capital of ABC?
Transcribed Image Text:ABC Corporation has the following capital structure and costs. Further assume that ABC's income
is taxed at 25%.
Amount
Pre-tax Cost
P 3,000,000
1,000,000
4,000,000
Bonds
8%
Preferred Shares
10%
Ordinary Shares
15%
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