JESSE FILE HOME INSERTPAGE LAYOUT Calculating the WACC - Excel FORMULAS DATA REVIEW VIEW Calibri A EB 11 P- A A Paste B I U - Cells Editing Alignment Number Conditional Format as Cell Formatting Table Styles Styles Clipboard Font Dinklage Corp. has 8 million shares of common stock outstanding. The current share price is $73. The most recent dividend was $3.90 and the dividend growth rate is 6 percent. The company also has two bond issues outstanding. The first bond issue has a face value of $85 million, a 7 percent coupon, and sells for 97 percent of par. The second issue has a face value of $50 million, an 8 percent coupon, and sells for 108 percent of par. The first issue matures in 21 years, the second in 6 years. What are the company's capital structure weights on a market value basis? Assume that the overall cost of debt is the weighted average of that implied by the two outstanding debt issues. Both bonds make semiannual payments. The tax rate is 21 percent. What is the company's WACC? 8,000,000 73 3.90 6% Shares outstanding Market price per share Dividend Growth rate First bond issue: Book value Coupon rate Bond price (% of par) Redemption value (% of par) ... Sheet1 ... + $ 85,000,000 7.00% 97 100 RFANY TUL THULLU Arial 1 - - 12 P- A A Paste B I U - Alignment Number Conditional Format as Cell Formatting Table Styles Styles Cells - Editir Clipboard Font c3 Dinklage Corp. has 8 million shares of common stock outstandin D E F G H I J 6% $ x for C Market price per share Dividend Growth rate First bond issue: Book value Coupon rate Bond price % of par) Redemption value (% of par) Settlement date Maturity date Payments per year Second bond issue: Book value Coupon rate Bond price (% of par) Redemption value (% of par) Settlement date Maturity date Payments per year Tax rate 85,000,000 7.00% 97 100 01/01/00 01/01/21 50,000,000 8.00% 108 100 01/01/00 01/01/06 21% w Sheeti . + 58. HOME Calculating the WACC - Excel FORMULAS DATA REVIEW FILE INSERT PAGE LAYOUT VIEW Paste B I U 1 - A Alignment Number Cells Edi Conditional Format as Cell Formatting Table Styles Styles Clipboard Font | C22 X for Redemption value (% of par) E F G H Complete the following analysis. Do not hard code values in your calculations. Leave the "Basis" input blank in the YIELD function. You must use the built-in Excel function to answer this question. Market value of equity Market value of first bond Market value of second bond Market value of debt & equity Market value weight of equity Market value weight of first bond Market value weight of second bond Cost of equity Pretax cost of first bond