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Can someone explain to me how I would do this question? Filer Manufacturing has 6 million shares of common stock outstanding. The current share price
Can someone explain to me how I would do this question?
Filer Manufacturing has 6 million shares of common stock outstanding. The current share price is $89, and the book value per share is $8. Filer Manufacturing also has two bond issues outstanding. The first bond issue has a face value of $85 million and a 6 percent coupon and sells for 96 percent of par. The second issue has a face value of $60 million and a 7 percent coupon and sells for 109 percent of par. The first issue matures in 9 years, the second in 21 years. a. What are Filer's capital structure weights on a book value basis? (Do not round intermediate calculations. Round the final answers to 4 decimal places.) b. What are Filer's capital structure weights on a market value basis? (Do not round intermediate calculations. Round the final answers to 4 decimal places.) c. Which are more relevant? Market value Book valueStep by Step Solution
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