Problem 21-03 A firm's current balance sheet is as follows: Debt Equity $105 a. What is the firm's weighted-average cost of capital at various combinations of debt and equity, given the following information Round your answers to one decimal place. Debt/Assets 0% 10 20 30 40 50 60 Assets After-Tax Cost of Debt 8% 8 Assets 8 99 10 $150 12 $ 150 Debt Cost of Equity 12% Equity 12 12 12 13 14 14 $ 45 Cost of Capital % * % $ * XXXX % % b. Construct a pro forma balance sheet that indicates the firm's optimal capital structure. Choose the best structure from the options analyzed in part a. Compare this balance sheet with the firm's current balance sheet. Round your answers to the neare dollar. % 0/0 % k

A firm's current balance sheet is as follows: Assets $150 Debt $45 Equity $105 a. What is the firm's weighted-average cost of capital at various combinations of debt and equity, given the following information Round your answers to one decimal place. b. Construct a pro forma balance sheet that indicates the firm's optimal capital structure. Choose the best structure from the options analyzed in part a. Compare this balance sheet with the firm's current balance sheet. Round your answers to the near dollar. Assets $150 Debt $ Equity s