Question
Andyco, Inc., has the following balance sheet and an equity market-to-book ratio of 1.6. Assuming the market value of debt equals its book value, what
Andyco, Inc., has the following balance sheet and an equity market-to-book ratio of 1.6. Assuming the market value of debt equals its book value, what weights should it use for its WACC calculation?
| Assets | Liabilities & Equity | ||
| $1,080 | Debt | $450 | |
| Equity | $630 | ||
The debt weight for the WACC calculation is
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External Auditing Tutorial
Authors: Jo Osborne, John Taylor
1st Edition
9781909173965, 1909173967
