Assets

Fixed Assets and Growth Opportunities = ?

Cash = $1,000,000

Total assets = ?

Liabilities

Equity = ?

Debt = ?

Liabilities and equity = ?

ABC Corp. will pay an annual dividend of $6 per share one year from now. This dividend is expected to grow at 3% and the equity discount rate is 15%. There are 100,000 shares outstanding. Debt consists of 5000 three year (remaining to maturity), annual coupon bonds with par value of $1000 and coupon rate of 6%. The market interest rate is 7%. Ignore personal taxes, the corporatiob tax is 30%.

Based on the above info, complete the balance sheet above (all marked with ?). Calculate the cost of unlevered equity