. Examine the following book-value balance sheet for University Products, Inc. What is the capital structure of the firm based on market values? The preferred stock currently sells for $15 per share and the common stock for $20 per share. There are one million common shares outstanding. (LO2)

Assets		Liabilities and Net Worth
Cash and short-term securities	$1	Bonds, coupon = 8%, paid annually (maturity = 10 years, current yield to maturity = 9%)	$10
Accounts receivable	3	Preferred stock (par value $20 per share)	2
Inventories	7	Common stock	10
Plant and equipment	21	Retained earnings	10
Total	$32	Total	$32