Source market value market proportions costs

Assignment Help Financial Management

Reference no: EM131586721

Given the following information for Lightning Power Co., find the WACC. Assume the company’s tax rate is 35 percent. Debt: 8,000 6.5 percent coupon bonds outstanding. $1,000 par value, 25 years to maturity, selling for 106 percent of par; the bonds make semiannual payments. Common stock: 310,000 shares outstanding, selling for $57 per share: the beta is 1.05. Preferred Stock: 15,000 shares of 4 percent preferred stock outstanding, currently selling for 72 per share. Market: 7 percent market risk premium and 4.5 percent risk-free rate.

WACC = Kd x Pd + Kpfd x Kpfd + Ke x Pe

The proportions, costs and weighted costs are in decimals to 4 places

Source Market Value Market Proportions Costs Weighted Costs Debt $ .0122 Preferred 1,080,000 Equity .6489 Total ? WACC = ?

Reference no: EM131586721

Questions Cloud

What benefit would analysis have for leaders : Describe the steps a leader might take to assess individual and group dynamics within a team

Calculate the cost of preferred stock : Calculate the cost of preferred stock.

Calculate the expected rate of return on the stock : Calculate the expected rate of return on the stock.

Calculate prices and prepare profit statement : BSBSMB402A PLAN SMALL BUSINESS FINANCES ASSESSMENT TASKS. Identify costs, calculate prices and prepare profit statement

Source market value market proportions costs : Source Market Value Market Proportions Costs Weighted Costs Debt $ .0122 Preferred 1,080,000 Equity .6489 Total ? WACC = ?

Problem related to a polynomial ring : Let R be a polynomial ring over an infinite field k and I a graded ideal of height r. If I is minimally generated by forms of degree p = 1.

Analyze the power and social influences : Analyze the power and social influences that may exist within the identified team/group's dynamics

Water resources continue to be misused : List and describe 2 potential solutions to the potential "water crisis" we may face if water resources continue to be misused.

The five practices of exemplary leadership : Create an outline of the components (at least three) from the Five Practices of Exemplary Leadership that will improve your chosen leadership areas.

User Account

All Pages