WACC The Patrick Company’s year-end balance sheet is shown below. Its cost of common equity is 16%, its before-tax cost of debt is 13%, and its marginal tax rate is 40%. Assume that the firm’s long-term debt sells at par value. The firm’s total debt, which is the sum of the company’s short-term debt and long-term debt, equals $1,152. The firm has 576 shares of common stock outstanding that sell for $4.00 per share. Calculate Patrick’s WACC usingmarket-value weights. Assets Liabilities and Equity Cash $130 Accounts payable and accruals $10 Accounts receivable 240 Short term debt 52 Inventories 360 Long term debt 1,100 Plant and equipment, net 2,160 Common equity 1,1728 Total assets $2,890 Total liabilities and equity $2,890

WACC The Patrick Company’s year-end balance sheet is shown below. Its cost of common equity is 16%, its before-tax cost of debt is 13%, and its marginal tax rate is 40%. Assume that the firm’s long-term debt sells at par value. The firm’s total debt, which is the sum of the company’s short-term debt and long-term debt, equals $1,152. The firm has 576 shares of common stock outstanding that sell for $4.00 per share. Calculate Patrick’s WACC usingmarket-value weights. Assets Liabilities and Equity Cash $130 Accounts payable and accruals $10 Accounts receivable 240 Short term debt 52 Inventories 360 Long term debt 1,100 Plant and equipment, net 2,160 Common equity 1,1728 Total assets $2,890 Total liabilities and equity $2,890

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter3: Evaluation Of Financial Performance

Section: Chapter Questions

Problem 13P

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The Paulson Company's year-end balance sheet is shown below. Its cost of common equity is 15%, its before-tax cost of debt is 8%, and its marginal tax rate is 25%. Assume that the firm's long-term debt sells at par value. The firm's total debt, which is the sum of the company's short-term debt and long-term debt, equals $1,201. The firm has 576 shares of common stock outstanding that sell for $4.00 per share. Assets Liabilities And Equity Cash $ 120 Accounts payable and accruals $ 10 Accounts receivable 240 Short-term debt 51 Inventories 360 Long-term debt 1,150 Plant and equipment, net 2,160 Common equity 1,669 Total assets $2,880 Total liabilities and equity $2,880 Calculate Paulson's WACC using market-value weights. Do not round intermediate calculations. Round your answer to two decimal places. %
The Paulson Company's year-end balance sheet is shown below. Its cost of common equity is 14%, its before-tax cost of debt is 10%, and its marginal tax rate is 25%. Assume that the firm's long-term debt sells at par value. The firm's total debt, which is the sum of the company's short-term debt and long-term debt, equals $1,183. The firm has 576 shares of common stock outstanding that sell for $4.00 per share. Cash Assets Accounts receivable Inventories Liabilities And Equity $ 120 Accounts payable and accruals $ 10 53 240 360 Short-term debt Long-term debt 1,130 30 Plant and equipment, net Total assets 2,160 $2,880 Common equity Total liabilities and equity 1,687 $2,880 Calculate Paulson's WACC using market-value weights. Do not round intermediate calculations. Round your answer to two decimal places. %
The Paulson Company's year-end balance sheet is shown below. Its cost of common equity is 16%, its before-tax cost of debt is 11%, and its marginal tax rate is 25%. Assume that the firm's long-term debt sells at par value. The firm's total debt, which is the sum of the company's short-term debt and long-term debt, equals $1,207. The firm has 576 shares of common stock outstanding that sell for $4.00 per share. Assets Cash Accounts receivable Inventories Plant and equipment, net Total assets % Liabilities And Equity Accounts payable and accruals Short-term debt $ 120 240 360 2,160 $2,880 Total liabilities and equity Calculate Paulson's WACC using market-value weights. Do not round intermediate calculations. Round your answer to two decimal places. Long-term debt Common equity $ 10 57 1,150 1,663 $2,880
The Paulson Company's year-end balance sheet is shown below. Its cost of common equity is 18%, its before-tax cost of debt is 9%, and its marginal tax rate is 25%. Assume that the firm's long-term debt sells at par value. The firm's total debt, which is the sum of the company's short-term debt and long-term debt, equals $1,181. The firm has 576 shares of common stock outstanding that sell for $4.00 per share. Liabilities And Equity $ 120 Accounts payable and accruals Short-term debt 240 360 Long-term debt 2,160 Common equity $2,880 Total liabilities and equity Calculate Paulson's WACC using market-value weights. Do not round intermediate calculations. Round your answer to two decimal places. Assets Cash Accounts receivable Inventories Plant and equipment, net Total assets % $ 10 61 1,120 1,689 $2,880
The Paulson Company’s year-end balance sheet is shown below. Its cost of common equity is 14%, its before-tax cost of debt is 10%, and its marginal tax rate is 40%. Assume that the firm’s long-term debt sells at par value. The firm’s total debt, which is the sum of the company’s short-term debt and long-term debt, equals $1,167. The firm has 576 shares of common stock outstanding that sell for $4.00 per share. Calculate Paulson’sWACC using market-value weights.AssetsCash $ 120Accounts receivable 240Inventories 360Plant and equipment, net 2,160Total assets $2,880 Liabilities and EquityAccounts payable and accruals $ 10Short-term debt 47Long-term debt 1,120Common equity 1,703Total liabilities and equity $2,880
The Pawlson Company's year-end balance sheet is shown below. Its cost of common equity is 14%, its before-tax cost of debt is 9%, and its marginal tax rate is 40%. Assume that the firm's long-term debt sells at par value. The firm’s total debt, which is the sum of the company’s short-term debt and long-term debt, equals $1,160. The firm has 576 shares of common stock outstanding that sell for $4.00 per share. Assets Liabilities And Equity Cash $ 120 Accounts payable and accruals $ 10 Accounts receivable 240 Short-term debt 60 Inventories 360 Long-term debt 1,100 Plant and equipment, net 2,160 Common equity 1,710 Total assets $2,880 Total liabilities and equity $2,880 Calculate Pawlson's WACC using market-value weights. Round your answer to two decimal places. Do not round your intermediate calculations. %???? I am unsure what this question is asking. Help with formula please!
The Paulson Company’s year-end balance sheet is shown below. Its cost of commonequity is 14%, its before-tax cost of debt is 10%, and its marginal tax rate is 40%.Assume that the firm’s long-term debt sells at par value. The firm’s total debt, which isthe sum of the company’s short-term debt and long-term debt, equals $1,167. The firm has576 shares of common stock outstanding that sell for $4.00 per share. Calculate Paulson’sWACC using market-value weights.
Question 5: The Holmes company's yearend balance sheet is shown below. Its cost of common equity is 12%, its before tax cost of debt is 12% and its marginal tax rate is 35%. Assume that the firm long term debt sells at par value. The firm total debt, which is the sum of the company short term debt and long term debt, equal $2820. The firm has 600 share of common stock outstanding that sells for $5.00 per share. Calculate Holmes WACC using market value weights. Assets Equities Cash 200 Account receivable 156 Equipment 5964 Total Assets 6320 Short term debts Long term debts Common equity Total Equities 520 2300 3500 6320
A company finances its operations with 57 percent debt and the rest using equity. The annual yield on the company's debt is 6% and the required rate of return on the stock is 14.6%. What is company's WACC? Assume the tax rate is 30%
1. The Dumaguete Co. has an equity cost of capital of 17%. The debt to equity ratio is 1.5 and a cost of debt is 11%. What is the weighted average cost of capital of the firm? (Assume a tax rate of 33%) a. 15.52% b. 3.06% c. 13.40% d. 16.97% 2. Metrobank’s stock is currently trading at P25 per share. The stock’s dividend is projected to increase at a constant rate of 7 percent per year. The required rate of return on the stock is 10 percent. what is the stock’s dividend yield today? a. cannot be determined from the information provided b. 3% c. 10% d. 7% 3. What is the expected rate of return on a bond that pays a coupon rate of 9%, has a par value of P1,000, matures in five years, and is currently selling for P714? Round your answer to the nearest whole percent and assume annual coupon payments. a. 13% b. 18% c. 16% d. 17%
The Duval Corporation has recently reported the following information: Net income $600,000 ROA 8% Interest expense $225,000 AP and Accruals $1,000,000 The company finances with only debt and common equity, where 40% of its capital comes from debt, while 60% comes from common equity. The applicable corporate tax rate is 35%. Calculate the firm’s basic earning power (BEP) ratio and return on equity (ROE).
Assume a company has 10mm outstanding shares of stock that currently trade at $50 per share. Assume the company cost of equity is 18% and its after-tax cost of debt is 6%. Assume the company has $250mm in long term debt and $50mm of other liabilities. What is the WACC?

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bartleby, a Learneo, Inc. business

Assets		Liabilities and Equity
Cash	$130	Accounts payable and accruals	$10
Accounts receivable	240	Short term debt	52
Inventories	360	Long term debt	1,100
Plant and equipment, net	2,160	Common equity	1,1728
Total assets	$2,890	Total liabilities and equity	$2,890