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LIS Company has $60 million in long-term debt, $85 million in shareholder’s equity [both figures are...

LIS Company has $60 million in long-term debt, $85 million in shareholder’s equity [both figures are market value basis]. The cost of equity is 13%, cost of long-term debt is 8.5% and the tax rate is 18%. (a) What is the weighted average cost of capital [WACC] for LIS? (b)LIS Company has a pretax income of $13.5 million. What is the value of the company based on calculation (a)

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