Calculating the WACC:

Here is the condensed 2021 balance sheet for Skye Computer Company (in thousands of dollars): 2021 $1,750 3,250 $5,000 Current assets Net fixed assets Total assets Accounts payable and accruals Short-term debt Long-term debt Preferred stock (10,000 shares) Common stock (50,000 shares) Retained earnings Total common equity Total liabilities and equity $ 600 200 1,500 300 1,175 1,225 $2,400 $5,000 Skye's earnings per share last year were $4.10. The common stock sells for $50.00, last year's dividend (Do) was $3.10, and a flotation cost of 12% would be required to sell new common stock. Security analysts are projecting that the common dividend will grow at an annual rate of 8%. Skye's preferred stock pays a dividend of $4.20 per share, and its preferred stock sells for $35.00 per share. The firm's before-tax cost of debt is 8%, and its marginal tax rate is 25%. The firm's currently outstanding 8% annual coupon rate, long-term debt sells at par value. The market risk premium is 4%, the risk-free rate is 5%, and Skye's beta is 1.412. The firm's total debt, which is the sum of the company's short-term debt and long-term debt, equals $1.7 million. **** PLEASE HELP ME SOLVE PART A,B,C, D. THANK YOU ****

Excel Activity: Cakulating the wacC Here is the condended 2021 balance sheet for Skve Computer Company (in thousands of doliars): Skye's earnings per share last veor were 54,10 . The common stock seils for $50.00, last year's dividend (0,5) was $3.10, and a fotation cost of 12% would be reauired to sell new commen steck. Securisy analysts are projecting that the common dividend wil grow at an annual rate of 8%. 5kyel preferred stock pays a dividend of $4.20 per share, and its preferred stock selis for $35.00 per share. The firm's before-tax cost of debt is 8\%, and its marginal tax rate is 25%. The firn's currently outstanding 8$ annual coupon rate, loog-term debt sells at par value. The market fikk premium is sw, the risk-free rate is 5%, and skye's beta is 1.412. The firm's total debt, which is the sum of the company's short-term debt and long-term debt, equais $1.7 million. The data has been collected in the Moroseh Excel file below. Download the spreadsheet and perform the required analysis to ansner the questions below. Do. not round intermedive calculations. Round your answers to two decimal places. *. Cakulate the cost of each capalai component, that is, the after-tax cost of debt, the cost of preferred stock, the cest of equily from retained earnings, and a. Calculate the cost of each capital component, that is, the after-tax cost of debn, the cost of preferred stock, the cost of equity from retained earnings, and the cost of rewly issued common stock. Use the DCF method to find the cost of common equity. After-tax cost of debt: \% Cont of preferted stock: W6 Cost of retained earnings: Cett of new common stock: % b. Now calculate the cost of common equity from retained earnings, using the CAPM method. differential to the CAPM value for r1 ) a. If Skye consinues to use the sume market value capital sructure, what is the firm's wacc assuming that (1) at uses only retained earnings for equity and wacc 1 : Whocy