Question
Garden Tools Inc. has bonds, preferred stock, and common stocks outstanding. The number of securities outstanding, the current price, and the required rate of return
Garden Tools Inc. has bonds, preferred stock, and common stocks outstanding. The number of securities outstanding, the current price, and the required rate of return for these securities are stated in the table below. The firs tax rate is 35%
Calculate the firms WACC adjusted for taxes using the market info in the table
|
| The number of securities outstanding | Selling price | Required rate of return |
| bonds | 1623 | 1222 | 10.97% |
| Preferred stock | 4958 | 73.62 | 20.00% |
| Common stocks | 1691 | 50.42 | 17.71% |
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Financial management theory and practice
Authors: Eugene F. Brigham and Michael C. Ehrhardt
12th Edition
978-0030243998, 30243998, 324422695, 978-0324422696
