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e the Dog Inc. is investing in a new portable iguana killing machine that will cost $200,000. The machine has a useful life of 6

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e the Dog Inc. is investing in a new portable iguana killing machine that will cost $200,000. The machine has a useful life of 6 years and falls into the 5-year property class for the depreciation purposes. The IRS MACRS schedule for the six years is: (1) 20% (2) 32% (3) 19.2% (4) 11.52%, (5) 11.52%, (6) 5.76%. It will generate $50,000 per year of savings for Jake and can be sold for $50,000 at the end of the 6-year period. Jake's corporate tax rate is 34%. In addition, Jake has 2000 outstanding 9% annual coupon bonds with a $1000 par value, 20 years to maturity and a price of $1085. Jake also has 60,000 shares of common stock outstanding that is selling for $45 per share. This stock has a beta of 2.45 (its Jake! he is a risky dog-dude!!), the expected market return is 12% and the risk-free rate is 5%. Finally, Jake has 36,000 shares preferred stock outstanding that pays a 55% dividend and sells for $40 per share. What are the market value weights of each security component of the WACC for Equity. Debt and Preferred Stock? O 428 Equity, 344 Debt, 228 Preferred O .348 Equity. 438 Debt. 214 Preferred 0 448 Equity, 334 Debt, .218 Preferred O 453 Equity, 365 Debt. .182 Preferred Answer .543 Equity, 345 Debt, .112 Preferred

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