Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
A firm has issued $5 million bonds that pay a 6.5% annual coupon and the yield to maturity is 6%. The market price of the bonds is $5.5 million. There are 2 million preference shares outstanding, which have a book value of $1.5 per share and which are trading for $1.80$ per share. The preference shares pay an annual dividend of $0.27 per share.
There are 8 million ordinary shares outstanding, which have a book value of $0.95 per share and which are currently priced at $0.80 per share. The firm's ordinary shares have a beta of 1.25. The yield on long-term government bonds is 3.5% p.a. The long-term market risk premium is 9% p.a. The corporate tax rate is 40%.
Problem a) What is the market value of preference shares?
Problem b) What is the cost of preference shares? Problem c) What is the market value of ordinary shares? Problem d) What is the cost of ordinary shares? Problem e) What is the firm's weighted average cost of capital (WACC)?
Wisconsin Warning Co. issued $5,000,000 of five-year, 8 % bonds with interest payable semi-annually at an effective interest rate of 11 %. It was determine the present value of the bonds payable were $ 4,434,520
A man deposits $2000 in an IRA on his 21st birthday and on each subsequent birthday up to, and including, his 29th (nine deposits in all). The account earns 8% compounded annually. If he leaves the money in the account without making any more deposit..
Think of all the information on a financial statement and the ways to analyze it. Select an analysis and state one advantage and one disadvantage of that analysis method in a specific business situation. Describe your business situation briefly but c..
Fixed manufacturing overhead costs are $100,000 per year. The company has received a special order request to sell an additional 8,000 units. The special order units will not incur a $2 per unit variable shipping cost that is associated with regular ..
At 5.25 percent interest, how long does it take to quadruple your money? At 5.25 percent interest, how long does it take to double your money?
Prepare the monthly adjusting journal entries for the above transactions. (Round answers to 0 decimal places, e.g. 5,275. Credit account titles)
Annual income of $300,000 per year for 10 years starting in exactly 20 years. The discount rate is 6%. What is the present value, today?
Wrecker Computing sells merchandise for $5,000 cash on September 30 (cost of merchandise is $2,900). The sales tax law requires Wrecker to collect 4% sales tax on every dollar of merchandise sold
choosing the method of depreciation with 30 tax rate straight line or double declining depreciation.the capital company
The installment method may be used for sales of all kinds of property with the exception of
Would your portfolio be riskless? Explain. What is the least risky security you can think of? Explain.
Mitchell Inc. issued 60, 6%, $1,000 bonds on January 1, 2020. Determine the selling price of the bonds. Round amount to the nearest dollar.
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!
whatsapp: +1-415-670-9521
Phone: +1-415-670-9521
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd