Question

Ten Pins Manufacturing has 9 million shares of common stock outstanding. The current share price is $75, and the book value per share is $6. The company also has two bond issues outstanding. The first bond issue has a face value of $85 million and a coupon rate of 10 percent and sells for 96 percent of par. The second issue has a face value of $65 million and a coupon rate of 11 percent and sells for 109 percent of par. The first issue matures in 25 years, the second in 9 years. a. What are the company’s capital structure weights on a book value basis? (Do not round intermediate calculations and round your answers to 4 decimal places, e.g., 32.1616.) Equity/Value Not attempted Debt/Value Not attempted b. What are the company’s capital structure weights on a market value basis? (Do not round intermediate calculations and round your answers to 4 decimal places, e.g., 32.1616.) Equity/Value Not attempted Debt/Value Not attempted

Answer #1

Ten Pins Manufacturing has 9 million shares of common stock
outstanding. The current share price is $75, and the book value per
share is $6. The company also has two bond issues outstanding. The
first bond issue has a face value of $85 million and a coupon rate
of 10 percent and sells for 96 percent of par. The second issue has
a face value of $65 million and a coupon rate of 11 percent and
sells for 109 percent...

Filer Manufacturing has 9 million shares of common stock
outstanding. The current share price is $88, and the book value per
share is $7. Filer Manufacturing also has two bond issues
outstanding. The first bond issue has a face value of $80 million
and a coupon rate of 5 percent and sells for 98 percent of par. The
second issue has a face value of $55 million and a coupon rate of 6
percent and sells for 106 percent of...

Dinklage Corp. has 9 million shares of common stock outstanding.
The current share price is $81, and the book value per share is $8.
The company also has two bond issues outstanding. The first bond
issue has a face value of $80 million, a coupon of 10 percent, and
sells for 96 percent of par. The second issue has a face value of
$50 million, a coupon of 11 percent, and sells for 104 percent of
par. The first issue...

Dinklage Corp. has 5 million shares of common stock outstanding.
The current share price is $71, and the book value per share is $6.
The company also has two bond issues outstanding. The first bond
issue has a face value of $65 million, a coupon of 6 percent, and
sells for 96 percent of par. The second issue has a face value of
$45 million, a coupon of 7 percent, and sells for 105 percent of
par. The first issue...

Dinklage Corp. has 8 million shares of common stock outstanding.
The current share price is $74, and the book value per share is $5.
The company also has two bond issues outstanding. The first bond
issue has a face value of $80 million, a coupon of 9 percent, and
sells for 95 percent of par. The second issue has a face value of
$60 million, a coupon of 10 percent, and sells for 108 percent of
par. The first issue...

Dinklage Corp. has 6
million shares of common stock outstanding. The current share price
is $78, and the book value per share is $5. The company also has
two bond issues outstanding. The first bond issue has a face value
of $65 million, a coupon of 7 percent, and sells for 98 percent of
par. The second issue has a face value of $35 million, a coupon of
8 percent, and sells for 106 percent of par. The first issue...

Erna Corp. has 8 million shares of common stock outstanding. The
current share price is $73, and the book value per share is $7.
Erna Corp. also has two bond issues outstanding. The first bond
issue has a face value of $85 million, has a 7 percent coupon, and
sells for 97 percent of par. The second issue has a face value of
$50 million, has an 8 percent coupon, and sells for 108 percent of
par. The first issue...

Erna Corp. has 8 million shares of common stock outstanding. The
current share price is $87, and the book value per share is $6.
Erna Corp. also has two bond issues outstanding. The first bond
issue has a face value of $75 million, has a coupon of 10 percent,
and sells for 97 percent of par. The second issue has a face value
of $50 million, has a coupon of 11 percent, and sells for 105
percent of par. The...

Ten
pins manufacturing has 7.3 million shares of common stock
outstanding. The current share price is $43 and book value per
share is $3. The company also has two bond issues outstanding. The
first bond issue has a face value of $68 million and a coupon rate
of 6 percent and sells for 109.3 percent of par. The second issue
has a face value of $58 million and a coupon rate of 6.5 percent
and sells for 106.9 percent of...

Masterson, Inc., has 9 million shares of common stock
outstanding. The current share price is $81, and the book value per
share is $7. The company also has two bond issues outstanding. The
first bond issue has a face value of $130 million, has a coupon
rate of 6 percent, and sells for 92 percent of par. The second
issue has a face value of $115 million, has a coupon rate of 5
percent, and sells for 103 percent of...

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