Mojito Mint Company has a debt-equity ratio of .35. The required return on the company's unlevered equity is 13%, and the pretax cost of the firm's debt is 7%. Sales revenue for the company is expected to remain stable indefinitely at last year's level of $17,500,000. Variable costs amount to 60% of sales. The tax rate is 40% and the company distributes all of its earnings as dividends at the end of the year.

a. If the company were financed entirely with equity, how much would it be worth?

b. What is the required return on the firm's equity?

c. Use the WACC method to calculate the value of the company. What is the value of the company's equity? What is the value of the company's debt?

d. Use the flow to equity method to calculate the value of the company's equity.