What is the firm market value capital structure

Assignment Help Finance Basics
Reference no: EM132501164

Raymond Mining Corporation has 8.8 million shares of common stock outstanding, 320,000 shares of 4% $100 par value preferred stock outstanding, and 149,000 7.50% semiannual bonds outstanding, par value $1,000 each. The common stock currently sells for $36 per share and has a beta of 1.40, the preferred stock currently sells for $92 per share, and the bonds have 10 years to maturity and sell for 117% of par. The market risk premium is 7.6%, T-bills are yielding 5%, and Raymond Mining's tax is 38%.

a. What is the firm's market value capital structure? (Enter your answers in whole dollars.)

Debt?

Equity?

Preferred stock?

b. If Raymond Mining is evaluating a new investment project that has the same risk as the firm's typical project, what rate should the firm use to discount the project's cash flows? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 3 decimal places.)

Discount rate?

Reference no: EM132501164

Questions Cloud

What is pearson cost of common equity : What is Pearson's cost of common equity? Do not round intermediate calculations. Round your answer to two decimal places.
Company cost of preferred stock-torch industries : Torch Industries can issue perpetual preferred stock at a price of $62.50 a share. The stock would pay a constant annual dividend of $7.00 a share.
How many actual direct labor-hours were worked : The labor rate variance was zero and the labor efficiency variance was $4,400 unfavorable. How many actual direct labor-hours were worked?
What is the return on shareholder equity : Given that the company pays out 40% of net income as dividends each year, what is the return on shareholder equity for this company?
What is the firm market value capital structure : What is the firm's market value capital structure? (Enter your answers in whole dollars.)
Calculate the size of the repayment : Calculate the size of the repayment that the bank requires Malorie to make at the end of the first month.
Find standard hours allowed for may production would be : During May 1,550 units were produced and the company worked 1,700 direct labor-hours. The standard hours allowed for May production would be
Calculating the project npv : If the firm's WACC is 10%, what is the project's NPV? Do not round intermediate calculations. Round your answer to the nearest cent.
Find spending variance for catering supplies in march would : The actual cost for catering supplies in March was $5,950. Find The spending variance for catering supplies in March would be closest to

Reviews

Write a Review

Finance Basics Questions & Answers

  Financial reporting and analysis

Finance is about Gunns Ltd, a company in dealing with forestry products in Australia. The company has also been listed in Australian Stock Exchange. As many companies producing forestry products, even Gunns Ltd is facing various problems. Due to the ..

  A report on financial accounting

This report is specific for a core understanding for Financial Accounting and its relevant factors.

  Describe the types of financial ratios

Describe the types of financial ratios and other financial performance measures that are used during venture's successful life cycle.

  Differences between sole proprietorship and corporation

Briefly describe the major differences between a sole proprietorship and a corporation

  Prepare a cash budget statement

Calculate the expected value of the apartment in 20 years' time. What is the mortgage loan repayment at the beginning of each month

  What are the implied interest rates

What are the implied interest rates in Europe and the U.S.?

  State pricing theory and no-arbitrage pricing theory

State pricing theory and no-arbitrage pricing theory

  Small business administration

Identify the likely stage for each venture and describe the type of financing each venture is likely to be seeking and identify potential sources for that financing.

  Effect of financial leverage

The Effect of Financial Leverage and working capital management

  Evaluate the basis for the payment to the lender

Evaluate the basis for the payment to the lender and basis for the payment to the company-counterparty.

  Importance of opps, ipps, mpfs and dmepos

Research and discuss the differences and importance of : OPPS, IPPS, MPFS and DMEPOS.

  Time value of money

Time Value of Money project

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd