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The Harden Companys cost of common equity is 14 percent, its before-tax cost of debt is 11 percent, and its marginal tax rate is 25
The Harden Companys cost of common equity is 14 percent, its before-tax cost of debt is 11 percent, and its marginal tax rate is 25 percent. The stock sells at book value. Using the following balance sheet, calculate Hardens WACC.
Assets | Liabilities and Equity | |||
Cash | $ 230 | |||
Accounts receivable | 210 | |||
Inventories | 580 | Long-term debt | $1,059 | |
Net plant and equipment | 2,190 | Common equity | 2,151 | |
Total assets | $3,210 | Total liabilities and equity | $3,210 | |
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