Mojito Mint Company has a debt-to-equity ratio of 0.35. The required return on the companys unlevered equity is 17 percent, and the pre-tax cost of the firms debt is 9 percent. Sales revenue for the company is expected to remain stable indefinitely at last years level of $28,900,000. Variable costs amount to 60 percent of sales. The tax rate is 40 percent, and the company distributes all its earnings as dividends at the end of each year.

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

Worth (V_U) $

b. What is the required return on the firms levered equity? (Do not round intermediate calculations. Round the final answer to 2 decimal places.)

Required return (r_S) %

c-1. Use the WACC method to calculate the value of the company. (Do not round intermediate calculations. Round the final answer to 2 decimal places. Omit $ sign in your response.)

Value of the company (V_L) $

c-2. What is the value of the companys equity? (Do not round intermediate calculations. Round the final answer to 2 decimal places. Omit $ sign in your response)

Value of the company's equity (S) $

c-3. What is the value of the companys debt? (Do not round intermediate calculations. Round the final answer to 2 decimal places. Omit $ sign in your response.)

Value of the company's debt (B) $