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P14.13 The following is the capital structure of XYZ Ltd. Source Amount Market value C/C 14% Preference capital Rs. 2,00,000 Rs. 2,30,000 14% Equity
P14.13 The following is the capital structure of XYZ Ltd. Source Amount Market value C/C 14% Preference capital Rs. 2,00,000 Rs. 2,30,000 14% Equity capital 5,00,000 7,50,000 17% 16% Debt 3,00,000 2,70,000 8% Total 10,00,000 12,50,000 Calculate the weighted average cost of capital, k., using book value weights, and market value weights. [Answer: WACC (BV) is 13.7% and WACC (MV) is 14.5%.]
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Intermediate Accounting
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield.
9th Canadian Edition, Volume 2
470964731, 978-0470964736, 978-0470161012
