Question

East firm has 30,000 shares of stock outstanding that are currently valued at $48 a share...

East firm has 30,000 shares of stock outstanding that are currently valued at $48 a share and provide a 13 percent rate of return. The firm also has 1000 bonds outstanding that have a face value of $1,000, a market price of $1,068, and a 7 percent coupon. These bonds mature in 6 years and pay interest semiannually. The tax rate is 35 percent. The company has 10000 shares of preferred stock with price $80 and return of 10% per year. The average tax rate is 35 percent. What is the WACC for Pierce firm?

Business   Finance   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
South firm has 30,000 shares of stock outstanding that are currently valued at $48 a share...
South firm has 30,000 shares of stock outstanding that are currently valued at $48 a share and provide a 13 percent rate of return. The firm also has 1000 bonds outstanding that have a face value of $1,000, a market price of $1,068, and a 7 percent coupon. These bonds mature in 6 years and pay interest semiannually. The tax rate is 35 percent. The company has 10000 shares of preferred stock with price $80 and return of 10% per...
Bob's firm is a retail chain of specialty hardware stores. The firm has 21,000 shares of...
Bob's firm is a retail chain of specialty hardware stores. The firm has 21,000 shares of stock outstanding that are currently valued at $68 a share and provide a 13.2% rate of return. The firm also has 500 coupon bonds outstanding that have a face value of $1,000, a market price of $1,068, mature in 6 years and have a YTM of 5.648%. The tax rate is 35%. Compute cost of debt Compute cost of equity Compute WACC PLEASE SOLVE...
Kim's Bridal Shoppe has 11,400 shares of common stock outstanding at a price of $48 per...
Kim's Bridal Shoppe has 11,400 shares of common stock outstanding at a price of $48 per share. It also has 275 shares of preferred stock outstanding at a price of $90 per share. There are 300 bonds outstanding that have a coupon rate of 6.7 percent paid semiannually. The bonds mature in 29 years, have a face value of $2,000, and sell at 108 percent of par. What is the capital structure weight of the common stock?
Western Electric has 23,000 shares of common stock outstanding at a price per share of $57...
Western Electric has 23,000 shares of common stock outstanding at a price per share of $57 and a rate of return of 14.2 percent. The firm has 6,000 shares of 7 percent preferred stock outstanding at a price of $48 a share. The preferred stock has a par value of $100. The company also has 350 corporate bonds, each with $1000 par value, and the bond currently sells for 102 percent of face. The yield-to-maturity on the debt is 8.49...
There are 2 million common shares of stock outstanding, currently trading for $35 per share. The...
There are 2 million common shares of stock outstanding, currently trading for $35 per share. The most recent dividend paid was $4 per share. Dividends are expected to increase by 2% per year for the foreseeable future. There are 25,000 bonds outstanding with a coupon rate of 5% that mature in eight years. The face value of these bonds is $1000, coupon payments are made annually, and the yield to maturity is 4%. There are 75,000 bonds outstanding with a...
Western Electric has 27,500 shares of common stock outstanding at a price per share of $70...
Western Electric has 27,500 shares of common stock outstanding at a price per share of $70 and a rate of return of 13.45 percent. The firm has 6,850 shares of 6.90 percent preferred stock outstanding at a price of $90.50 per share. The preferred stock has a par value of $100. The outstanding debt has a total face value of $377,000 and currently sells for 106.5 percent of face. The yield to maturity on the debt is 7.81 percent. What...
Western Electric has 25,000 shares of common stock outstanding at a price per share of $65...
Western Electric has 25,000 shares of common stock outstanding at a price per share of $65 and a rate of return of 13.70 percent. The firm has 6,600 shares of 6.40 percent preferred stock outstanding at a price of $88.00 per share. The preferred stock has a par value of $100. The outstanding debt has a total face value of $362,000 and currently sells for 104 percent of face. The yield to maturity on the debt is 7.66 percent. What...
suppose a firm has 42 million shares of common stock outstanding at a price of $50...
suppose a firm has 42 million shares of common stock outstanding at a price of $50 per share. The firm also has 300,000 bonds outstanding with a current price of $1006.30. The outstanding bonds have yield to maturity 9.6% The firm's common stock beta is 1.6 and the corporate tax rate is 35%. The expected market return is 13% and teh T-bill rate is 2%. What is the WACC for this firm?
City Rentals has 44,000 shares of common stock outstanding at a market price of $32 a...
City Rentals has 44,000 shares of common stock outstanding at a market price of $32 a share. The common stock just paid a $1.50 annual dividend and has a dividend growth rate of 2.5 percent. There are 7,500 shares of $9 preferred stock outstanding at a market price of $72 a share. The outstanding bonds mature in 11 years, have a total face value of $825,000, a face value per bond of $1,000, and a market price of $989 each,...
A firm has 14 million shares of common stock outstanding with a beta of 1.15 and...
A firm has 14 million shares of common stock outstanding with a beta of 1.15 and a market price of $42 a share. The 10 percent semiannual bonds are selling at 91 percent of par/face value. There are 220,000 bonds outstanding that mature in 17 years. The market risk premium is 6.75 percent, T-bills are yielding 3.5 percent, and the firm's tax rate is 32 percent. 1. What is the firms cost of Equity? by using CAPM 2. What is...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT