Question
Filer Manufacturing has 12.1 million shares of common stock outstanding. The current share price is $47, and the book value per share is $4. Filer
Filer Manufacturing has 12.1 million shares of common stock outstanding. The current share price is $47, and the book value per share is $4. Filer Manufacturing also has two bond issues outstanding. The first bond issue has a face value of $104 million, has a 9 percent coupon, and sells for 90 percent of par. The second issue has a face value of $79.86 million, has a 9 percent coupon, and sells for 94.5 percent of par. The first issue matures in 10 years, the second in 7 years.(a) What is Filer's capital structure weight of equity on a book value basis? (b) What is Filer's capital structure weight of debt on a book value basis? (a) What is Filer's capital structure weight of equity on a market value basis? (b) What is Filer's capital structure weight of debt on a market value basis?
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