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Complete the table below to calculate the WACC for Blue Sky Ltd given the following data: Balance Sheet Blue Sky Ltd Assets Current Assets $1

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Complete the table below to calculate the WACC for Blue Sky Ltd given the following data: Balance Sheet Blue Sky Ltd Assets Current Assets $1 200 000 Long Term Assets 3 000 000 4 200 000 Liabilities and Equity Accounts Payable 600 000 Bank Overdraft 300 000 1 500 000 Debentures ($1000 par, 7.5% p.a., semi-annual) Ordinary Shares ($2 par) Retained Earnings 1 000 000 800 000 4 200 000 Additional information: i) Overdraft rates are 7.5% p.a., compounded daily. ii) The debentures mature in 6 years and are trading at par. iii) Ordinary shares are trading at $8.00. iv) The value of the fully-franked annual dividends are expected to grow at a rate of 3% p.a. for the foreseeable future. After all tax considerations, the value of the most recent dividend (just paid) to shareholders is 70c. iv) The effective corporate tax rate is 20%. (Show all calculations for your table entries.) Source Market Value Proportion AT cost (%) Weighted Cost Total

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