The Paulson Company's year end balance sheet is shown below Its cost of common equity is 16 , its before tax cost of debt is 8 , and its marginal tax rate is 40 Assume that the firm's long term debt sells at par value The firms total debt, which is the sum of the companys short term debt and long term debt, equals $1,148 The firm has 576 shares of common stock outstanding that sell for $4 00 per share The data has been collected in the Microsoft Excel Online file below Open the spreadsheet and perform the required analysis to answer the question below Open spreadsheet Calculate Paulson's WACC using market value weights Round your answer to two decimal places Do not round your intermediate calculations Assets Liabilities And Equity Cash $ 120 Accounts payable and accruals $ 10 Accounts receivable 240 Short term debt 48 Inventories 360 Long term debt $1,100 Plant and equipment, net 2,160 Common equity 1,722 Total assets $2,880 Total liabilities and equity $2,880 F D E C Cost of common equity (r ) 16 00 Before tax cost of debt (r) 8 00 4 5 Marginal tax rate (T) 6 Common shares outsfanding 7 Current stock price 8 Long term debt sells at par value 40 00 576 $4 00 Yes 10 Balance Sheet Liabilities and Equity Accounts payable and accruals Short term debt Long term debt Common equity Total liabilities and equity 11 Assets $10 00 $48 00 $1,100 00 $1,722 00 $120 00 Cash Account receivable Inventories Plant and equipment, net Total assets 12 $240 00 $360 00 $2,160 00 13 14 15 16 $2,880 00 $2,880 00 17 18 Formulas 19 Market value of total debt 20 Market value of common equity Total capital N A N A 21 N A Sheetl D E C $360 00 $2,160 00 $2,880 00 B A Long term debt Common equity Total liabilities and equity Inventories Plant and equipment, net Total assets $1,100 00 $1,722 00 $2,880 00 Formulas Market value of total debt Market value of common equity Total capital N A N A N A Percentage of debt Percentage of common equity N A N A After tax cost of debt N A Weighted Average Cost of Capital (WACC) N A

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The Paulson Company's year-end balance sheet is shown below. Its cost of common equity is 16%, its before-tax cost of debt is 8%, and its

The Paulson Company's year-end balance sheet is shown below. Its cost of common equity is 16%, its before-tax cost of debt is 8%, and its marginal tax rate is 40%. Assume that the firm's long-term debt sells at par value. The firms total debt, which is the sum of the companys short-term debt and long-term debt, equals $1,148. The firm has 576 shares of common stock outstanding that sell for $4.00 per share. The data has been collected in the Microsoft Excel Online file below. Open the spreadsheet and perform the required analysis to answer the question below.

Open spreadsheet

Calculate Paulson's WACC using market-value weights. Round your answer to two decimal places. Do not round your intermediate calculations.

Assets		Liabilities And Equity
Cash	$ 120	Accounts payable and accruals	$ 10
Accounts receivable	240	Short-term debt	48
Inventories	360	Long-term debt	$1,100
Plant and equipment, net	2,160	Common equity	1,722
Total assets	$2,880	Total liabilities and equity	$2,880

F D E C Cost of common equity (r.) 16.00% Before-tax cost of debt (r) 8.00% 4 5 Marginal tax rate (T) 6 Common shares outsfanding 7 Current stock price 8 Long-term debt sells at par value 40.00% 576 $4.00 Yes 10 Balance Sheet: Liabilities and Equity Accounts payable and accruals Short-term debt Long-term debt Common equity Total liabilities and equity 11 Assets $10.00 $48.00 $1,100.00 $1,722.00 $120.00 Cash Account receivable Inventories Plant and equipment, net Total assets 12 $240.00 $360.00 $2,160.00 13 14 15 16 $2,880 00 $2,880 00 17 18 Formulas 19 Market value of total debt 20 Market value of common equity Total capital #N/A N/A 21 #N/A Sheetl D E C $360.00 $2,160.00 $2,880.00 B A Long-term debt Common equity Total liabilities and equity Inventories Plant and equipment, net Total assets $1,100.00 $1,722.00 $2,880.00 Formulas Market value of total debt Market value of common equity Total capital #N/A #N/A #N/A Percentage of debt Percentage of common equity #N/A #N/A After-tax cost of debt #N/A Weighted Average Cost of Capital (WACC) #N/A