Estimating Market and Book Values and Cost of Capital Measures The December 31, 2007, partial balance sheet and the 2007 retained earnings statement from Colgate-P amounts). The website Finance.Yahoo.com reported that the total market capitalization of Colgate-Palmo December 31, 2007. Also, Yahoo estimates its total enterprise value at $42.49 billion, and its market beta cost is 5.20%, and its marginal tax rate is 35%. Assume that the risk-free rate equals 5.20% and the marke $ 155.9 138.1 1.066.8 Liabilities and Shareholders' Equity Notes and loans payable Current portion of long-term debt Accounts payable Accrued income taxes Other accruals Total current liabilities 262.7 1.5392 eBook Print Support ned earnings statement from Colgate-Palmolive Company (CL) follow (5 millions, except per share al market capitalization of Colgate-Palmolive was $38.53 billion and its stock price was $75.69 as of Hue at $42.49 billion, and its market beta at 0.46. In addition, Colgate-Palmolive's average pretax borrowing ask-free rate equals 5.20% and the market premium equals 5,60%. $ 155.9 138.1 1.066.8 262.7 1.539.2 SOLO 5 155.9 Liabilities and Shareholders' Equity Notes and loans payable Current portion of long term debt Accounts payable Accrued income taxes Other accruals Total current liabilities Long-term debt Deferred income taxes Other liabilities Total liabilities Shareholders' Equity Preferred stock Common stock $1 par value (1,000,000,000 shareauthorized. 732,853,180 shares issued) Additional paid-in capital Retained earnings Accumulated other comprehensive income 138.1 1,066.8 262.7 1,539.2 3.162.7 3.171.9 264.1 1.177.1 7.775.8 197.5 732.9 1,517.7 10,627.5 (1.666.8) 11.408.8 (218.9) (8.903.7) 2,286.2 $10,062.0 Unearned compensation Treasury stock at cost Total shareholders' equity Total liabilities and shareholders' equity Common Shares Outstanding Balance, December 31, 2006 512,658,587 Shares issued for stock options 10,051,559 Treasury stock acquired (18,062,892) Other 4,387,547 Common Shares Outstanding Balance, December 31, 2006 512,658,587 Shares issued for stock options 10.051.559 Treasury stock acquired (18,062,892) Other 4,387.547 Balance December 31, 2007 509,034,801 (a) Verify Yahoo's computation of Colgate-Palmolive's market capitalization using the data from its financial reporte places.) Market capitalization = 5 shares = $ billion X (b) Compute the book value of Colgate-Palmolive's long-term debt as of December 31, 2007 million (0) Compute the market value of Colgate-Palmolive's debt using the data from Yahoo. (Round your answer to two d billion $ (d) Identify reasons behind the difference between the amounts computed in parts (b) and (c). (Select all that apply Yahoo Finance.com might include other liabilities, such as lease obligations, in the calculation of debt. The market value of debt doesn't include the issuing of new treasury stock The market price of Colgate-Palmolive's debt changed in value on December 31, 2007 The market value and book value of debt differs due to accounting usage of historical costi t capitalization using the data from its financial report excerpts above. (Round your answer to two decimal ares = $ billion debt as of December 31, 2007. Ling the data from Yahoo. (Round your answer to two decimal places.) unts computed in parts (b) and (c). (Select all that apply.) such as lease obligations, in the calculation of debt. ng of new treasury stock. billion (d) Identify reasons behind the difference between the amounts computed in parts (b) and (c). (Select all that Yahoo Finance.com might include other liabilities, such as lease obligations, in the calculation of de The market value of debt doesn't include the issuing of new treasury stock. The market price of Colgate-Palmolive's debt changed in value on December 31, 2007. The market value and book value of debt differs due to accounting usage of historical cost. (e) Compute Colgate-Palmolive's cost of debt capital. (Round your answer to one decimal place.) (f) Compute Colgate-Palmolive's cost of equity capital. (Round your answer to one decimal place.) (g) Using your rounded answer from (e) and (f) above, compute Colgate-Palmolive's weighted average costo your rounded answer from (c) above for this calculation (Do not round until your final answer. Round answe to two decimal places.) puted in parts (b) and (c). (Select all that apply.) Hease obligations, in the calculation of debt. w treasury stock. alue on December 31, 2007. ounting usage of historical cost. swer to one decimal place.) aswer to one decimal place.) te-Palmolive's weighted average cost of capital. Use the market capitalization from Ycharts.com and d until your final answer. Round answer to one decimal place.)