Question
Filer Manufacturing has 6 million shares of common stock outstanding. The current share price is $72, and the book value per share is $7. The
Filer Manufacturing has 6 million shares of common stock outstanding. The current share price is $72, and the book value per share is $7. The company also has two bond issues outstanding. The first bond issue has a face value $70 million, a coupon of7 percent, and sells for 97 percent of par. The second issue has a face value of $50 million, a coupon of8 percent, and sells for 106 percent of par. The first issue matures in 22 years, the second in 6 years. |
a. | What are the company's capital structure weights on a book value basis?(Do not round intermediate calculations and round your answers to 4 decimal places, e.g., 32.1616.) |
Equity / Value | |
Debt / Value |
b. | What are the company's capital structure weights on a market value basis?(Do not round intermediate calculations and round your answers to 4 decimal places, e.g., 32.1616.) |
Equity / Value | |
Debt / Value |
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started