Question

Please write clear answer!! 14. Finding the WACC Given the following information for Lightning Power Co.,...

Please write clear answer!!

14. Finding the WACC Given the following information for Lightning Power Co., find the WACC. Assume the company’s tax rate is 21 percent. Debt: 16,000 6.2 percent coupon bonds outstanding, $1,000 par value, 25 years to maturity, selling for 108 percent of par; the bonds make semiannual payments. Common stock: 535,000 shares outstanding, selling for $81 per share; beta is 1.20. Preferred stock: 20,000 shares of 4.2 percent preferred stock outstanding, currently selling for $92 per share. The par value is $100. Market: 7 percent market risk premium and 3.1 percent riskfree rate.

Homework Answers

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
You are given the following information for Lightning Power Co. Assume the company’s tax rate is...
You are given the following information for Lightning Power Co. Assume the company’s tax rate is 30 percent.   Debt: 6,000 7.9 percent coupon bonds outstanding, $1,000 par value, 25 years to maturity, selling for 108 percent of par; the bonds make semiannual payments.   Common stock: 510,000 shares outstanding, selling for $69 per share; the beta is 1.12.   Preferred stock: 29,000 shares of 4 percent preferred stock outstanding, currently selling for $89 per share.   Market: 10 percent market risk premium and...
You are given the following information for Lightning Power Co. Assume the company’s tax rate is...
You are given the following information for Lightning Power Co. Assume the company’s tax rate is 30 percent.   Debt: 6,000 7.9 percent coupon bonds outstanding, $1,000 par value, 25 years to maturity, selling for 108 percent of par; the bonds make semiannual payments.   Common stock: 510,000 shares outstanding, selling for $69 per share; the beta is 1.12.   Preferred stock: 29,000 shares of 4 percent preferred stock outstanding, currently selling for $89 per share.   Market: 10 percent market risk premium and...
You are given the following information for Lightning Power Co. Assume the company’s tax rate is...
You are given the following information for Lightning Power Co. Assume the company’s tax rate is 40 percent. Debt: 8,000 7.5 percent coupon bonds outstanding, $1,000 par value, 25 years to maturity, selling for 104 percent of par; the bonds make semiannual payments. Common stock: 470,000 shares outstanding, selling for $65 per share; the beta is 1.08. Preferred stock: 25,000 shares of 3 percent preferred stock outstanding, currently selling for $85 per share. Market: 8 percent market risk premium and...
P14-15 Finding the WACC [LO3] Consider the following information for Evenflow Power Co.,      Debt: 6,000...
P14-15 Finding the WACC [LO3] Consider the following information for Evenflow Power Co.,      Debt: 6,000 7.5 percent coupon bonds outstanding, $1,000 par value, 22 years to maturity, selling for 103 percent of par; the bonds make semiannual payments.   Common stock: 132,000 shares outstanding, selling for $61 per share; the beta is 1.06.   Preferred stock: 19,000 shares of 6.5 percent preferred stock outstanding, currently selling for $106 per share.   Market: 8 percent market risk premium and 6.5 percent risk-free rate....
Given the following information for Lightning Power Co., find the WACC. Assume the company’s tax rate...
Given the following information for Lightning Power Co., find the WACC. Assume the company’s tax rate is 35 percent. Debt: 8,000 bonds outstanding, selling for $1,060 and yield to maturity 7% Common Stock: 310,000 shares outstanding, selling for $77 per share; the Beta is 1.15. Preferred stock: 15,000 shares of preferred stock outstanding, currently selling for $60 per share. The preferred stock pays an annual fixed dividend of $4. Market: 7 percent market risk premium and 4.5 percent risk-free rate.
Given the following information for Magrath Power Co., find the WACC. Assume the company's tax rate...
Given the following information for Magrath Power Co., find the WACC. Assume the company's tax rate is 35 percent. Debt: 10,000 with 6.4%coupon bonds outstanding, $1,000 par value, 25 years to maturity, selling for 108 percent of par; the bonds make semiannual payments. Common stock: 495,000 shares outstanding, selling for $63 per share; the beta is 1.15. Preferred stock: 35,000 shares of 3.5% preferred stock outstanding, currently selling for $72 per share. Market: 7% market risk premium and 3.2 percent...
12. Given the following information for Watson Power Co., find the WACC. Assume the company’s tax...
12. Given the following information for Watson Power Co., find the WACC. Assume the company’s tax rate is 35 percent. Debt: 10,000 6.4 percent coupon bonds outstanding, $1,000 par value, 25 years to maturity, selling for 108 percent of par; the bonds make semiannual payments. Common stock: 495,000 shares outstanding, selling for $63 per share; the beta is 1.15. Preferred stock: 35,000 shares of 3.5 percent preferred stock outstanding, currently selling for $72 per share. Market: 7 percent market risk...
Information on Lightning Power Co., is shown below. Assume the company’s tax rate is 25 percent....
Information on Lightning Power Co., is shown below. Assume the company’s tax rate is 25 percent. Debt: 18,000 5.8 percent coupon bonds outstanding, $1,000 par value, 23 years to maturity, selling for 107.6 percent of par; the bonds make semiannual payments. Common stock: 610,000 shares outstanding, selling for $84.75 per share; beta is 1.05. Preferred stock: 27,500 shares of 4.45 percent preferred stock outstanding, currently selling for $92.50 per share. The par value is $100. Market: 6.8 percent market risk...
Given the following information for Williams Power Co., find the WACC. Assume the company’s tax rate...
Given the following information for Williams Power Co., find the WACC. Assume the company’s tax rate is 21 percent. Debt: 75,000 bonds with a 5.8 percent coupon outstanding, $1,000 par value, 15 years to maturity, selling for 105 percent of par; the bonds make semiannual payments. Common stock: 925,000 shares outstanding, selling for $72 per share; the beta is .99. Preferred 65,000 shares of 2.8 percent preferred stock outstanding, currently stock: selling for $50 per share. Assume par value is...
You are given the following information for Watson Power Co. Assume the company’s tax rate is...
You are given the following information for Watson Power Co. Assume the company’s tax rate is 21 percent.   Debt: 15,000 bonds with a 5.8 percent coupon outstanding, $1,000 par value, 25 years to maturity, selling for 108 percent of par; the bonds make semiannual payments.   Common stock: 575,000 shares outstanding, selling for $64 per share; the beta is 1.09.   Preferred stock: 35,000 shares of 2.8 percent preferred stock outstanding, currently selling for $65 per share. The par value is $100....