Examine the following book-value balance sheet for

Reference no: EM13570986

Examine the following book-value balance sheet for University Products, Inc. The preferred stock currently sells for $10 per share and the common stock for $15 per share. There are 1 million common shares outstanding.

BOOK VALUE BALANCE SHEET (all values in millions)
Assets			Liabilities and Net Worth
Cash and short-term securities	$	2.0	Bonds, coupon = 6%, paid annually (maturity = 10 years, current yield to maturity = 8%)	$	20.0
Accounts receivable		5.0	Preferred stock (par value $15 per share)		3.0
Inventories		9.0	Common stock (par value $0.2)		0.2
Plant and equipment		21.0	Additional paid-in stockholders' equity		7.8
			Retained earnings		6.0

Total	$	37.0	Total	$	37.0

What is the capital structure of the firm on the basis of market values? (Do not round intermediate calculations. Enter your answers in millions rounded to 2 decimal places and percentage values to 2 decimal places.)

Security	Market Value	Percent
Bonds	$ million	%
Preferred stock	million	%
Common stock	million	%

Total	$ million	%

Reference no: EM13570986

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