Solution-What are the factors affecting Cost of Capital

What are the factors affecting Cost of Capital

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Reference no: EM132468096

Problem - The Kay Company has the following Capital structure as at 31^st March, 2019.

	Based on Book Value	Based on Market Value	% Costs
Debentures	300,000	330,000	7
Preference	100,000	110,000	9
Equity	1,500,000	1,700,000	15
Debt	200,000	180,000	10

Required -

1. Determine the Weighted Average cost of capital using:

a) Book Value weights

b) Market Value weights

2. What are the factors affecting Cost of Capital?

Reference no: EM132468096

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What are the factors affecting Cost of Capital

Reference no: EM132468096

Reference no: EM132468096

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Financial Accounting Questions & Answers

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