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Rockansky Corporation has 2.61 million ordinary shares that currently trade for $68.56, a equity book value of $4.3 million, and retained earnings of $49.4 million.
Rockansky Corporation has 2.61 million ordinary shares that currently trade for $68.56, a equity book value of $4.3 million, and retained earnings of $49.4 million. It also has $84.5 million in debt currently trading for 106.0% of par. Its effective tax rate is 23.0%. A) What weights should it use in computing its WACC? The debt weight for the WACC calculation is %. (Round to two decimal places.) The equity weight for the WACC calculation is %. (Round to two decimal places.) B) Rockansky Corporation has a cost of equity of 10.6% and has an effective cost of debt of 6.0%. What is this firm's WACC? Rockansky Corporation's WACC is %. (Round to two decimal places.)
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