What is the wacc of eggs

Assignment Help Finance Basics
Reference no: EM132125194

Eggs,Inc. reported earnings available to common stock of $4200000 last year. From these earnings, the company paid a dividend of $1.26 on each of its 1000000 common shares outstanding. The capital structure of the company includes 40% debt, 10% preferred stock, and 50% common stock. It is taxed at a rate of 40%. The market price of the common stock is $40 and dividends are expected to grow at a rate of 6% for the foreseeable future.The company plans to issue $2.00 dividend preferred stock for a market price of $25.00 per share. Flotation costs would amount to $3.00 per share.In addition,the company will also issue $1000-par-value, 10% coupon, 5-year bonds that can be sold for $1200 each. Flotation costs would amount to $25.00 per bond. What is the WACC?

Reference no: EM132125194

Questions Cloud

What is the effective annual rate of a savings account : What is the effective annual rate of a savings account that pays an APR of 3% and compounds quarterly? Answer in percent and round to two decimal places.
Research one painting and sculpture or work of architecture : Research one painting, sculpture or work of architecture. A description of the use of color, line, composition or other formal elements in the work.
What is the effective annual rate of a savings account : What is the effective annual rate of a savings account that pays an APR of 3% and compounds quarterly? Answer in percent and round to two decimal places.
Roedel electronics produces variety of electrical components : Roedel Electronics produces a variety of electrical components, including a remote controller for televisions and a remote controller for VCRs.
What is the wacc of eggs : Eggs,Inc. reported earnings available to common stock of $4200000 last year. From these earnings, the company paid a dividend of $1.26 on each
Choose 3 ideas or metaphors used to describe the church : In the New Testament, there are over 100 descriptive ideas and metaphors used to describe the church (bride of Christ, body, people of God, etc.).
What is the present value of the annuity payments : What is the present value of the annuity payments as of today, assuming a 8% interest rate, compounded annually?
In what stage of the its life cycle is social media : In what stage of the its life cycle is social media? Support your answer.
How can internet technologies help a business : How can Internet technologies help a business form strategic alliances with its customers, suppliers, and others?

Reviews

Write a Review

Finance Basics Questions & Answers

  What is the principal balance after given time

You purchase a house that costs $850,000 with an 8%, 30-year mortgage. You are required to make a down payment of 20%.

  The project is estimated to generate 2110000 in annual

keiper inc. is considering a new three-year expansion project that requires an initial fixed asset investment of 2.79

  One-time-step ohmc problem

Perform a one-time-step MC simulation of 1,000,000 paths (use Brownian motion or GARCH (1,1) or any model of your choice). Consider either a call or put payoff at this time. Use (5.67) and (5.68) to solve for the average cost of hedging and the o..

  Pvs of cash flow

To find out the present value of uneven series of cash flows, you may find out the PVs of the individual cash flows and then sum them. Annuity procedures can never be of use, even if some of the cash flows constitute an annuity

  What is the modified duration of the same mortgage

What is the Macaulay duration of an eight-year, 10%, interest-only mortgage with annual payments occurring at the ends of the years?

  How is the concept of cost of goods sold different

How is the concept of cost of goods sold different than contribution margin? Explain the contribution margin concept/computation and when to use the information.

  Find the lump sum amount today equal to present value

How much money is required to invest today to have a lump sum of $100,000 in 40 years if the interest rate is 12.5% compounded yearly?

  Assess the challenges of managers

Assess the challenges of managers providing accurate, timely, and effective feedback to employees. Recommend how managers can overcome any two of the challenges you identified.

  Fair value for shares of coda

What would be a fair value for shares of CODA given a 50% Debt to Cap ratio, a 3% after tax cost of debt and a 6% cost of equity?

  Write down the forecast of next periods earnings

Write down the forecast of next period's earnings if Earnings are a mean reverting process with no trend or cycle and Earnings are a mean reverting process with a trend but not a cycle.

  What types of revenue will generated from capital investment

What types of revenue will be generated from the capital investment? Will insurance reimburse? If so, discuss the impact of the various reimbursements (e.g., Medicare, Medicaid, private, or self-pay).

  What is the market value of wingler’s stock

Your broker offers to sell you shares of Wingler & Company common stock, which paid a dividend of $2 yesterday. You expect the dividend to grow at a rate of 5 percent per year into perpetuity. If the appropriate rate of return for the stock is 12 ..

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