please show all the calculation and formula used.
please help quesyion b) and c) if capable. Tq 
Question 1 (a) CJ \& Ho Inc. currently has a market cap of $500m and $100m of bank loan. The riskfree rate, market premium and share betas are estimated to be 4%,5.2% and 0.9 respectively. The bank loan's interest is 7% p.a. and the corporate tax rate is 25%. Required: (i) Determine the firm's cost of equity. (3 marks) (ii) Determine the firm's WACC. (3 marks) (iii) The firm plans to issue $200m of new bonds. The bonds have a coupon rate of 7% p.a., a maturity term of 10 years and an expected market of price of $1100 after issuance. Determine the bonds' yield-to-maturity. (4 marks) (iv) The firm also plans to sell $150m of preferred shares to institutional investors. Each share will have a par value of $10 and provide $0.85 of annual dividends. The preferred shares will not be traded on the market. Determine cost of preferred equity. (3 marks) (v) Determine the firm's new WACC after taking into account the issuance of new bonds and preferred shares. (5 marks) (b) "Moderate borrowing does not significantly increase the chances of financial distress or bankruptcy. Consequently, a firm should borrow as much as possible to lower its WACC." Required: Identify and critically discuss TWO (2) capital structure theories that agree with the above statements. (10 marks) (c) Recently, the managing director of ZYX Ltd. commented during its annual shareholder meeting that "our ultimate financial goal is to expand our market base faster than our competitors at any cost". Required: Critically discuss whether you agree with the managing director's statement. (5 marks) (Total : 33 marks) Question 1 (a) CJ \& Ho Inc. currently has a market cap of $500m and $100m of bank loan. The riskfree rate, market premium and share betas are estimated to be 4%,5.2% and 0.9 respectively. The bank loan's interest is 7% p.a. and the corporate tax rate is 25%. Required: (i) Determine the firm's cost of equity. (3 marks) (ii) Determine the firm's WACC. (3 marks) (iii) The firm plans to issue $200m of new bonds. The bonds have a coupon rate of 7% p.a., a maturity term of 10 years and an expected market of price of $1100 after issuance. Determine the bonds' yield-to-maturity. (4 marks) (iv) The firm also plans to sell $150m of preferred shares to institutional investors. Each share will have a par value of $10 and provide $0.85 of annual dividends. The preferred shares will not be traded on the market. Determine cost of preferred equity. (3 marks) (v) Determine the firm's new WACC after taking into account the issuance of new bonds and preferred shares. (5 marks) (b) "Moderate borrowing does not significantly increase the chances of financial distress or bankruptcy. Consequently, a firm should borrow as much as possible to lower its WACC." Required: Identify and critically discuss TWO (2) capital structure theories that agree with the above statements. (10 marks) (c) Recently, the managing director of ZYX Ltd. commented during its annual shareholder meeting that "our ultimate financial goal is to expand our market base faster than our competitors at any cost". Required: Critically discuss whether you agree with the managing director's statement. (5 marks) (Total : 33 marks)
