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Given the following information: Percent of capital structure: Debt 35 % Preferred stock 20 Common equity 45 Additional information: Bond coupon rate 14% Bond yield
Given the following information:
Percent of capital structure:
Debt | 35 | % |
Preferred stock | 20 | |
Common equity | 45 | |
Additional information:
Bond coupon rate | 14% | ||
Bond yield to maturity | 12% | ||
Dividend, expected common | $ | 8.00 | |
Dividend, preferred | $ | 15.00 | |
Price, common | $ | 75.00 | |
Price, preferred | $ | 126.00 | |
Flotation cost, preferred | $ | 6.80 | |
Growth rate | 5% | ||
Corporate tax rate | 40% | ||
Calculate the Hamilton Corp.'s weighted cost of each source of capital and the weighted average cost of capital. (Do not round intermediate calculations. Input your answers as a percent rounded to 2 decimal places.)
Weighted Cost
Debt ______ %
Preferred stock ______ %
Common equity ______ %
Weighted average cost of capital ______ %
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