Question
hero manufacturing has 4 million shares of common stock outstanding. the current share price is $76 and the book value per share $5. the company
hero manufacturing has 4 million shares of common stock outstanding. the current share price is $76 and the book value per share $5. the company also has two bond issues outstanding, both with semiannual coupons. the first bond issue has a face value $90 million and a coupon of 5 percent and sells for 94 percent of par. the second issue has a face value of $70 million and a coupon of 6 percent and sells for 104 percent of par. the first issue matures in 20 years, the second in 3 years.
A. what are the company's capital structure weights on a book value basis?
B. what are the company's capital structure weights on a market value basis?
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