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Given the following information. Percent of capital structure: Debt 20 % Preferred stock 30 Common equity 50 Additional information: Corporate tax rate 40 % Dividend,
Given the following information.
Percent of capital structure: | |||
Debt | 20 | % | |
Preferred stock | 30 | ||
Common equity | 50 | ||
Additional information: | |||
Corporate tax rate | 40 | % | |
Dividend, preferred | $8.00 | ||
Dividend, expected common | $3.50 | ||
Price, preferred | $103.00 | ||
Corporate growth rate | 8 | % | |
Bond yield | 9 | % | |
Flotation cost, preferred | $7.20 | ||
Price, common | $78.00 | ||
Calculate the weighted average cost of capital for Hadley Corporation. Line up the calculations in the order shown in Table 111. (Round intermediate calculations to 2 decimal places. Round the final answers to 2 decimal places.)
Weighted Cost | |
Debt (Kd) | % |
Preferred stock (Kp) | |
Common equity (Ke) | |
Weighted average cost of capital (Ka) | % |
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