Skolits Corporation has a cost of equity of 11 percent and an aftertax cost of debt of 4.68 percent. The company's balance sheet lists long-term debt of $380,000 and equity of $640,000. The company's bonds sell for 105.7 percent of par and market-to-book ratio is 3.04 times. If the company's tax rate is 39 percent, what is the WACC? Multiple Choice O 9.13% O 10.54% O9.61% O 9.92% 8.65%
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- Brower Co. is considering the following alternative financing plans: Income tax is estimated at 40% of income. Determine the earnings per share of common stock, assuming that income before bond interest and income tax is 2,000,000.Skolits Corp. has a cost of equity of 11.8 percent and an aftertax cost of debt of 4.44 percent. The company's balance sheet lists long-term debt of $340,000 and equity of $600,000. The company's bonds sell for 104.1 percent of par and market-to-book ratio is 2.80 times. If the company's tax rate is 39 percent, what is the WACC?Skolits Corporation has a cost of equity of 11.2 percent and an aftertax cost of debt of 4.62 percent. The company's balance sheet lists long-term debt of $370, 000 and equity of $630,000. The company's bonds sell for 105.3 percent of par and the market - to - book ratio is 2.98 times. If the company's tax rate is 25 percent, what is the WACC?
- Upton Umbrellas has a cost of equity of 11.4 percent, the YTM on the company's bonds is 6 percent, and the tax rate is 35 percent. The company's bonds sell for 102.9 percent of par. The debt has a book value of $402,000 and total assets have a book value of $950,000. If the market-to-book ratio is 2.68 times, what is the company's WACC? Multiple Choice 9.75% 5.55% 9.36% 8.27% 8.17%Take it all away has a cost of equity of 10.84 percent, a pretax cost of debt of 5.47 percent, and a tax rate of 39 percent. The company's captial structure consists of 76 percent debt on a book value basis, but debt is 38 percent of the company's value on a market value basis. What is the company's WACCSixx AM Manufacturing has a target debt-equity ratio of 0.7. Its cost of equity is 17 percent, and its cost of debt is 11 percent. If the tax rate is 32 percent, what is the company's WACC?
- Upton Umbrellas has a cost of equity of 11.4 percent, the YTM on the company's bonds is 6 percent, and the tax rate is 21 percent. The company's bonds sell for 102.9 percent of par. The debt has a book value of $402.000 and total assets have a book value of $950,000. If the market-to-book ratio is 2.68 times, what is company's WACC? Multiple Choice 817% 9.94% 9.36% 5.55% NextBento, Inc., has a target debt-equity ratio of .65. Its cost of equity is 16 percent, and its cost of debt is 5 percent. If the tax rate is 23 percent, what is the company’s WACC? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) WACC:______%Williamson, Inc., has a debt-equity ratio of 2.45. The company's weighted average cost of capital is 10 percent, and its pretax cost of debt is 6 percent. The corporate tax rate is 25 percent. a. What is the company's cost of equity capital? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b. What is the company's unlevered cost of equity capital? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) c. What would the weighted average cost of capital be if the company's debt-equity ratio were 80 and 1.70? (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) a. Cost of equity b. Unlevered cost of equity C. WACC at debt-equity ratio of 80 WACC at debt-equity ratio of 1.70 % % % %
- Fama's Llamas has a WACC of 9.4 percent. The company's cost of equity is 13 percent, and its pretax cost of debt is 6.7 percent. The tax rate is 22 percent. What is the company's target debt-equity ratio? Note: Do not round intermediate calculations and round your answer to 4 decimal places, e.g., 32.1616. Debt-equity ratio 1.1594the backwoods lumber co. has a debt equity ratio of .80. the firm's required return on assets is 12% and its cost of equity is 15.68% what is the pre tax cost of debt based on M&M II with no taxes?Clifford, Inc., has a target debt-equity ratio of .80. Its WACC is 9.1 percent, and the tax rate is 25 percent. a. If the company's cost of equity is 13 percent, what is its pretax cost of debt? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b. If instead you know that the aftertax cost of debt is 5.8 percent, what is the cost of equity? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) a. Cost of debt % b. Cost of equity %