Reference no: EM133006059
You have the following information about burgundy basins, a skin manufacturer.
equity shares outstanding 20 million
stock price per share $48
yield to maturity on debt 7.5%
book value of interest bearing debt 395 million
coupon interest rate on debt 5.3%
market value on debt 290 million
book value of equity 500 million
cost of equity capital 13.6%
tax rate 35%
Burgundy is contemplating what for the company is an average-risk investment costing 56 million and promising an annual ATCF of $5.8 million in perpetuity.
Problem 1: What is the internal rate of return on the investment?
Problem 2: What is Burgundy's weighted average cost of capital?
|
What will be expense to be recognized in income statement
: On 01/01/20X1 the Beta Company granted 10,000 stock options. What will be the expense to be recognized in the income statement as of 12/31/20X1?
|
|
How much overhead was applied to production during the year
: During the year, 110,700 kg of raw materials were purchased at $0.97 per kilogram. How much overhead was applied to production during the year
|
|
Find how many units must be sold to achieve
: If the unit sales price is $5,350, unit variable cost is $2,460, and total fixed costs are $803,000, how many units must be sold to achieve a target net income
|
|
How do find what is the project pi
: A project has an initial cost of $40,000, expected net cash inflows of $11,000 per year for 6 years, and a cost of capital of 9%. What is the project's PI?
|
|
What is burgundy weighted average cost of capital
: What is Burgundy's weighted average cost of capital? Burgundy is contemplating what for the company is an average-risk investment costing 56 million
|
|
How long will it be before you have enough to buy the car
: The bank pays 5.5 percent annual interest on its accounts. How long will it be before you have enough to buy the car
|
|
How much would the value of the company increase
: By how much would the value of the company increase if accepted the better project (plane)? Shao Airlines is considering the purchase of two alternative planes.
|
|
What is the hedge that minimizes risk
: The index is currently standing at 1000, and each contract is for delivery of $250 times the index. What is the hedge that minimizes risk
|
|
Critical race theory application
: Critical Race Theory Application - critical race theory and concept of White supremacy as an analytical tool to understand racism, bias, and social inequality
|