Reference no: EM132724999
Question - Lancelin Manufacturing has a target debt-to-equity ratio of .35. It only has ordinary share for its equity. Its cost of equity is 12 percent, and its pre-tax cost of debt is 6 percent. The tax rate is 27.50 percent.
1. If the company's total equity is $2,500,000, how much is the target total liabilities? (Round to the nearest dollar). Case sensitive. E.g., type in your answer in this format 1,000,000 for $1,000,000.
2. How much is after-tax cost of equity? Case sensitive. E.g., type in your answer in this format 2.00 for 2.
3. How much is the after-tax cost of debt? Case sensitive. E.g., type in your answer in this format 2.00 for 2.
4. What is the company's WACC? Case sensitive. E.g., type in your answer in this format 2.00 for 2.
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