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Bob Ltd is subject to 30% income tax rate. Below is information about the capital structure of Bob Ltd Source of funds Market value Required
Bob Ltd is subject to 30% income tax rate. Below is information about the capital structure of Bob Ltd
Source of funds | Market value | Required rate of return |
Long-term debt | 10,000 | 6% |
Preferred stock | 50,000 | 8% |
Common stock | 40,000 | 10% |
Required
Calculate Bob Ltd weighted-average cost of capital (WACC)
Place your answer in the table provided here below
Sources of funds | Market value | Required rate of return | Weights of market value | Weighted-average cost of capital |
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