Taunton Corp. Suppose you have been hired as a financial consultant to Taunton Corp., a large, publicly traded firm that is the market share leader in radon detection systems (RDSS). The company is looking at setting up a manufacturing plant overseas to produce a new line of RDSs. The project will require an investment of $9.0 million dollars and the president of the company wants to be sure she understands her cost of capital before going ahead with the decision Market information for the latest year-end (December 31/2020) is as follows: Debt The company has issued 14,300 bonds, each with a par value of $1,000 and a coupon rate of 5.40 percent (payable semi-annually). The bonds were issued 9 years ago with a 20 year maturity. They are currently selling for $1039.00 each. Preferred Stock 151,000 preferred shares have been authorized (with 127,000 issued and outstanding). The closing price of preferred shares was $31.30 per share. Common Equity 507,000 common shares have been authorized (with 451,000 shares issued and outstanding). Common shares are selling for $77.00 per share. Taunton Corp. uses G. M. Wharton as its lead underwriter. Wharton charges 3.00 percent commission on new common stock issues, 4.00 percent on new preferred stock issues, and 5.00 percent on new debt issues. Wharton has included all direct and indirect flotation costs in these rates. The preferred shares were issued six years ago and pay an annual dividend of $1.25 per share. Last year, Taunton Corp. declared and paid a common share dividend of $1.16 per share. This represented a 3.00 percent growth in het eten dhe formation from the case of the Northeate one or more of the Common op D1 Pp PO: F Requirements: A. Find market values of outstanding bonds, preferred shares and common shares: oporting information 1. Bonds: a. What is the market value of each bond? (Enter your answer to two decimal places. (eg $1234)) b. What is the total market value of bonds at Dec 31, 2020 (Round your answer to whole numbers. For example, $1 284,000 not $1234 million) 15 16 | DDD 18 19 20 2. Preferred shares: What is the total market value of preferred shares at Dec 31, 2020 (Round your answer to whole numbers. For example, $1.234,000 not $1.234 million) 21 3. Common shares: What is the total market value of common shares at Dec 31, 2020 (Round your answer to whole numbers For example, $1234,000 not $1 234 million) 22 Supporting informat 28 B.What weights are assigned to debt, preferred shares a common equity on Dec 31, 2020 (Round your answer to two decimal places leg 12.34) Do not enter the percent sign) 24 Debt Preferred Common percent percent Ipercent 25 26 27 C. Calculate the after-tax cost of the various components of WACC: (Round your answer to two decimal places. (er 12.34). Do not enter the percent sien 28 Taunton Corp. Suppose you have been hired as a financial consultant to Taunton Corp., a large, publicly traded firm that is the market share leader in radon detection systems (RDSS). The company is looking at setting up a manufacturing plant overseas to produce a new line of RDSs. The project will require an investment of $9.0 million dollars and the president of the company wants to be sure she understands her cost of capital before going ahead with the decision Market information for the latest year-end (December 31/2020) is as follows: Debt The company has issued 14,300 bonds, each with a par value of $1,000 and a coupon rate of 5.40 percent (payable semi-annually). The bonds were issued 9 years ago with a 20 year maturity. They are currently selling for $1039.00 each. Preferred Stock 151,000 preferred shares have been authorized (with 127,000 issued and outstanding). The closing price of preferred shares was $31.30 per share. Common Equity 507,000 common shares have been authorized (with 451,000 shares issued and outstanding). Common shares are selling for $77.00 per share. Taunton Corp. uses G. M. Wharton as its lead underwriter. Wharton charges 3.00 percent commission on new common stock issues, 4.00 percent on new preferred stock issues, and 5.00 percent on new debt issues. Wharton has included all direct and indirect flotation costs in these rates. The preferred shares were issued six years ago and pay an annual dividend of $1.25 per share. Last year, Taunton Corp. declared and paid a common share dividend of $1.16 per share. This represented a 3.00 percent growth in het eten dhe formation from the case of the Northeate one or more of the Common op D1 Pp PO: F Requirements: A. Find market values of outstanding bonds, preferred shares and common shares: oporting information 1. Bonds: a. What is the market value of each bond? (Enter your answer to two decimal places. (eg $1234)) b. What is the total market value of bonds at Dec 31, 2020 (Round your answer to whole numbers. For example, $1 284,000 not $1234 million) 15 16 | DDD 18 19 20 2. Preferred shares: What is the total market value of preferred shares at Dec 31, 2020 (Round your answer to whole numbers. For example, $1.234,000 not $1.234 million) 21 3. Common shares: What is the total market value of common shares at Dec 31, 2020 (Round your answer to whole numbers For example, $1234,000 not $1 234 million) 22 Supporting informat 28 B.What weights are assigned to debt, preferred shares a common equity on Dec 31, 2020 (Round your answer to two decimal places leg 12.34) Do not enter the percent sign) 24 Debt Preferred Common percent percent Ipercent 25 26 27 C. Calculate the after-tax cost of the various components of WACC: (Round your answer to two decimal places. (er 12.34). Do not enter the percent sien 28