. Question Help (Weighted average cost of capital) ABBC Inc operates a very successful chain of yogurt and coffee shops spread across the southwestern part of the United States and needs to raise funds for its planned expansion into the Northwest. The firm's balance sheet at the close of 2015 appeared as follows: At present, the fom's common stock is selling for a price equal to 3 times as book value and the firm's Investors require a return of 19 percent. The fom's bonds command a yield to maturity of 6 percent, and the tim faces a tax rate of 37 percent. At the end of the previous year, ABBC's bonds were trading near their par value 1. What does ABBC's capital structure look like? b. What is ABBC's weighted average cost of capital? C. If ABBC's stock price were to rise such that it sodat 3.5 times to book value and the cost of costy fell to 16 percent, what would the firm's weighted were cost of capital be (assuming the cost of debt and tax rate do not change? a. What is the proportion of de Data Table L% (Round to two decimal What is the proportion of eq Cash $ 2,140,000 % (Round to be decimal Accounts receivable 4.410.000 b. What is ADC's weighted 1,130,000 Long term det $8.569.000 32.987.000 Net property, plant and equipment % (Round to two decimal 32.098.000 Common equity $ 40.667.000 $40.667,000 c. If ABDC's stock price were Total assets Total debt and rage cost of capitale (assuming the cost of debt and tax rato Phone Enter your answer in each of Print Done 16 A how Slo (Weighted average cost of capita) ABSC Inc. operates a very successful chain of yogurt and coffee shops spread across the southwestern part of the United States and needs to raise funds for its planned expansion into the Northwest. The firm's balance sheet at the close of 2015 appeared as follows: At present, the firm's common stock is selling for a price equal to 3 times its book value, and the firm's investors require a return of 19 percent. The firm's bonds command a yield to maturity of 6 percent, and the frm faces a tax rate of 37 percent. At the end of the previous year, ABBC's bonds were trading near their par value a. What does ABBC's capital structure look like? b. What is ABBC's weighted average cost of capital? C. ABBC's stock price were to rise such that a solid at 3.5 times is book value and the cost of equity fell to 16 percent, what would the firm's weighted average cost of capital be (assuming the cost of debt and tax rate do not change? a. What is the proportion of debt fina Data Table 0% (Round to two decimal places What is the proportion of equity fnan Cash $ 2,140,000 D% Round to two decimal places Accounts receivable 4.410.000 Inventions 1,130,000 b. What is ABC's weighted average Long term debe $ 8.500.000 32.007.000 Net property, plant and equipment Common equity 32.000.000 (Round to two decimal places Total assets 40,607,000 Total debt and guilty $ 40,667,000 c. If ABBC's stock price were to se ost of capitalbe (assuming the cost of debt and tax rate Print Done Enter your answer in each of the a
