Question
Charlotte's Crochet Shoppe has 16,100 shares of common stock outstanding at a price per share of $81 and a rate of return of 11.85 percent.
Charlotte's Crochet Shoppe has 16,100 shares of common stock outstanding at a price per share of $81 and a rate of return of 11.85 percent. The company also has 340 bonds outstanding, with a par value of $2,000 per bond. The pre-tax cost of debt is 6.25 percent and the bonds are selling at 99 percent of par. What is the company's WACC if the tax rate is 35 percent?
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To calculate the Weighted Average Cost of Capital WACC we need to consider the proportion of equity ...
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Intermediate accounting
Authors: J. David Spiceland, James Sepe, Mark Nelson
7th edition
978-0077614041, 9780077446475, 77614046, 007744647X, 77647092, 978-0077647094
