Given the following information, calculate the WACC.Capital Structure:Debt =40%Pref Stock = 20%Common St = 40%Additional Information:Corporate Tax ratePreferred Dividend25%$8.50%3DExpected Common Dividend = $2.50$105.00Preferred Price=Growth Rate =7%9.5%Bond Yield =Preferred Floatation Cost = $3.60$75.00Common Stock Price=

The Weighted average cost of capital(WACC) refers to the method in which each category of capital is…

Given the following information, calculate the WACC. Capital Structure: Debt = 40% Pref Stock = 20% Common St= 40% Additional Information: Corporate Tax rate 25% %3D Preferred Dividend $8.50 Expected Common Dividend $2.50 $105.00 7% 9.5% Preferred Price Growth Rate = Bond Yield= Preferred Floatation Cost= Common Stock Price= $3.60 $75.00

Given the following information, calculate the WACC. Capital Structure: Debt = 40% Pref Stock = 20% Common St= 40% Additional Information: Corporate Tax rate 25% %3D Preferred Dividend $8.50 Expected Common Dividend $2.50 $105.00 7% 9.5% Preferred Price Growth Rate = Bond Yield= Preferred Floatation Cost= Common Stock Price= $3.60 $75.00

Corporate Fin Focused Approach

5th Edition

ISBN:9781285660516

Author:EHRHARDT

Publisher:EHRHARDT

Chapter9: The Cost Of Capital

Section9.8: The Weighted Average Cost Of Capital (wacc)

Problem 3ST

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Given the following information: Percent of capital structure: Debt Preferred stock Common equity (retained earnings) Additional information: Bond coupon rate Bond yield to maturity Dividend, expected common Dividend, preferred Price, common Price, preferred Flotation cost, preferred Growth rate Corporate tax rate 40% 20 40 12% 10% $ 6.00 $ 13.00 $ 65.00 $ 122,00 $ 4.00 9% 30% Calculate the Hamilton Corporation'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.
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%
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. X Answer is complete but not entirely correct. Weighted-average cost of capital 11.6 × % 1 million $ 23 7.68% $14 million 9% 7% 0.75 5.8% 40%
Given the following information: Percent of capital structure: Preferred stock Common equity (retained earnings) Debt Additional information: Corporate tax rate. Dividend, preferred $ 5.00 Dividend, expected common $ 5.50 Price, preferred $101.00 Growth rate Bond yield. 34% 4% 5% Flotation cost, preferred $5.20 Price, common $ 74.00 Debt Preferred stock Common equity (retained earnings) Weighted average cost of capital 20% 70 10. Calculate the weighted average cost of capital for Digital Processing Inc. (Do not round intermediate calculations. Input your answers as a percent rounded to 2 decimal places.) Notice that this problem asks for the weighted costs. These are the unweighted costs times the weights. Like this: (ka)(wa) weighted cost of debt. Weighted Cost % 0.00%
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. %
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