Question
Binomial Tree Farms financing includes $5.10 million of bank loans and $6.10 million book (face) value of 10-year bonds, which are selling at 80% of
Binomial Tree Farms financing includes $5.10 million of bank loans and $6.10 million book (face) value of 10-year bonds, which are selling at 80% of par value. Its common equity is shown in Binomials Annual Report at $6.77. It has 510,000 shares of common stock outstanding which trade on the Wichita Stock Exchange at $15 per share. What debt ratio should Binomial use to calculate its WACC?
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Managerial Accounting A Focus on Ethical Decision Making
Authors: Steve Jackson, Roby Sawyers, Greg Jenkins
5th edition
324663854, 978-0324663853
