User Account

All Pages

What is the weighted average pre-tax cost

Assignment Help Finance Basics
Reference no: EM132466672

A company has a market value of $500 million. It has a market value of equity of $200 million, a market value of long-term debt of $150 million, an a market value of short term debt of $150 million.

The cost of equity is 12%, the cost of long-term debt is 8%, and the cost of short-term debt is 6%. The marginal tax rate is 35%.

What is the weighted average pre-tax cost of capital for the company?

Reference no: EM132466672

Questions Cloud

How diaz should record interest expense for : Reduces the market interest rate of 6%, with interest payable at the end of each year. Diaz should record interest expense for 2020 of
Describe the company current financial condition : Explain why it has been receiving media attention and describe the company's current financial condition compared to the rest of the industry.
What is the sustainable growth for company : What is the sustainable growth for this company?
Determine how the acquisition is reported as a merger : Determine how the acquisition is reported as a merger?concerning reporting for the acquisition of the remaining 20%, if the acquisition is reported as a merger?
What is the weighted average pre-tax cost : A company has a market value of $500 million. It has a market value of equity of $200 million, a market value of long-term debt of $150 million
How much should this company invest today : How much should this company invest today, assuming an average inflation rate of 2% and a 10% annual return?
What is the amount of discretionary financing needed : Owners equity is $34 million. Long term debt is $90 million. Additionally, the firm raised $12.9 million of equity capital.
Forecasted retained earnings for year 2011 : Year 2010 ending retained earnings were $2 million. Year 2011 forecasted sales are $100,000 with a 25% net margin and a 20% dividend payout ratio.
Determine percent of sales method : Determine Percent of Sales Method,Determine the adjusted balances of Accounts Receivable, Allowance for Doubtful Accounts, and Bad Debt Expense.

Reviews

Write a Review

Finance Basics Questions & Answers

  Establishment of a right indwelling uretal stent

What is the code and modifier for endoscopy establishment of a right indwelling uretal stent.

  Explain why hr decisions are heavily regulated

Based on your analysis of current social forces, what new laws or regulations do you think will be passed or issued in the next few years?

  Develop a comprehensive outline for a test

Select a system of your choice and develop a comprehensive outline for a test and evaluation plan. Identify the categories of test, and describe the inputs and outputs for each category.

  Describe the techniques available to a firm for slowing

Describe the techniques available to a firm for slowing disbursements.

  Compute the market value of the bonds

Compute the market value of the bonds. How many bonds will the firm have to issue to receive the needed funds? What is the firm's after-tax cost of debt if the firm's tax rate is 34 percent?

  What will be the debt-to-equity ratio

What will be the debt-to-equity ratio if it borrows $220,000? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

  Find the probability you get both contracts

Contracts. Your company bids for two contracts. You believe the probability you get contract #1 is 0.8.

  What are the equilibrium price and quantity

Suppose the demand for good X is given by Qd = 60 -2Px + 0.01M + 7 PR where Qd = quantity of X demanded; Px price of X; M = (average) consumer income; PR = price of a related good R.

  What rate of return is she earning

Tracie invested $60,000 in exchange for payment of $2500 a year forever. What rate of return is she earning?

  What is the exercise value of the call option

A call option on the stock with a $25 strike price currently sells for $7 (that's the premium.) What is the exercise value of the call option

  Calculate each projects payback period calculate the net

newman manufacturing is considering a takeover of grips tool.nbsp during the year just completed grips earned 4.25

  Retirement considering time value

Calculation of amount required in retirement considering time value -  retirement fund investment? Show your formulas and input

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!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

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