Question
Given the following information, calculate the firms WACC. Assume the interest on the debt is 100% tax deductible. Tax rate: 20% Debt rate: 6% Preferred
Given the following information, calculate the firms WACC. Assume the interest on the debt is 100% tax deductible. Tax rate: 20% Debt rate: 6% Preferred stock dividend rate: 9% of $100 par value Risk-free rate of return: 2% Market rate of return: 12% Stock beta: 1.3 Debt value: $50,000,000 P/S value: $15,000,000 C/S value: $35,000,000 b) What would a firm use the WACC for?
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Auditing And Assurance Services
Authors: Timothy Louwers, Penelope Bagley, Allen Blay, Jerry Strawser, Jay Thibodeau
8th International Edition
1260570517, 978-1260570519
