Capital structure weight of equity on book value basis

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Filer Manufacturing has 8.1 million shares of common stock outstanding. The current share price is $45, and the book value per share is $5. Filer Manufacturing also has two bond issues outstanding. The first bond issue has a face value of $61 million, has a 7 percent coupon, and sells for 96 percent of par. The second issue has a face value of $50.22 million, has a 7 percent coupon, and sells for 100.4 percent of par. The first issue matures in 10 years, the second in 6 years.

Requirement 1:

(a) What is Filer's capital structure weight of equity on a book value basis? (Do not round your intermediate calculations.)

(b) What is Filer's capital structure weight of debt on a book value basis? (Do not round your intermediate calculations.)

Requirement 2:

(a) What is Filer's capital structure weight of equity on a market value basis? (Do not round your intermediate calculations.)

(b) What is Filer's capital structure weight of debt on a market value basis? (Do not round your intermediate calculations.)

Reference no: EM131603169

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