Problem 19 6 WACC The table below shows a book balance sheet for the Wishing Well Motel chain The companys long term debt is secured by its real estate assets, but it also uses short term bank loans as a permanent source of financing It pays 11 interest on the bank debt and 9 interest on the secured debt Wishing Well has 10 million shares of stock outstanding, trading at $89 per share The expected return on Wishing Wells common stock is 22 (Table figures in $ millions ) Cash and marketable securities $ 170 Bank loan $ 310 Accounts receivable 330 Accounts payable 180 Inventory 50 Current liabilities $ 490 Current assets $ 550 Real estate 2,600 Long term debt 2,400 Other assets 140 Equity 400 Total $ 3,290 Total $ 3,290 Calculate Wishing Wells WACC Assume that the book and market values of Wishing Wells debt are the same The marginal tax rate is 21 (Do not round intermediate calculations Enter your answer as a percent rounded to 1 decimal place )

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Problem 19 6 WACC The table below shows a book balance sheet for the Wishing Well Motel chain  The companys long term debt is secured by its real estate assets, but it also uses short term bank loans as a permanent source of financing  It pays 11  interest on the bank debt and 9  interest on the secured debt  Wishing Well has 10 million shares of stock outstanding, trading at $89 per share  The expected return on Wishing Wells common stock is 22   (Table figures in $ millions ) Cash and marketable securities $ 170 Bank loan $ 310 Accounts receivable 330 Accounts payable 180 Inventory 50 Current liabilities $ 490 Current assets $ 550 Real estate 2,600 Long term debt 2,400 Other assets 140 Equity 400 Total $ 3,290 Total $ 3,290 Calculate Wishing Wells WACC  Assume that the book and market values of Wishing Wells debt are the same  The marginal tax rate is 21   (Do not round intermediate calculations  Enter your answer as a percent rounded to 1 decimal place )

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Problem 19-6 WACC The table below shows a book balance sheet for the Wishing Well Motel chain. The companys long-term debt is secured by its

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Cash and marketable securities	$	170	Bank loan	$	310
Accounts receivable		330	Accounts payable		180
Inventory		50	Current liabilities	$	490
Current assets	$	550
Real estate		2,600	Long-term debt		2,400
Other assets		140	Equity		400
Total	$	3,290	Total	$	3,290