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financeSWC Co . has the following capital structure: The common shares of SWC Co are currently selling at RM 3 . 5 0 per share,
financeSWC Co has the following capital structure:
The common shares of SWC Co are currently selling at RM per share, with dividends
anticipated to grow by annually in future, and an RM dividend payment was made
recently.
The preference shares are irredeemable and have a market value of RM per share.
SWC Co's loan notes are currently selling at RM per loan note and will be redeemed
at RM per loan note in years. The annual yield until maturity is SWC Co is subject
to corporate taxation at rate of You are required to calculate:
a Market value of equity
b Market value of preference shares
c Market value of loan notes
d Total market value
e Cost of equity
f Cost of debt and cost of preference share
g Weighted Average Cost of Capital WACC
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