Question
The QRS Corporation has three bond issuances outstanding. Bond 1 is an annual bond with a $1,000 par value, $80 coupon payments, maturing in 9
The QRS Corporation has three bond issuances outstanding. Bond 1 is an annual bond with a $1,000 par value, $80 coupon payments, maturing in 9 years, and trades today at $1,254.41 with 120,000 bonds outstanding. Bond 2 is a semi-annual bond with a $10,000 par value, $262.50 coupon payments, maturing in 7 years, and trades today at $9,799.60 with 14,500 bonds outstanding. Bond 3 is a semi-annual bond with a $1,000 par value, $31 coupon payments, maturing in 4 years and trades at $972.50 with 95,000 bonds outstanding. QRS has 1,600,000 shares of preferred stock outstanding paying a dividend of $6.30 with a share price of $53.50. QRS has 58 million shares of common stock outstanding with a reported of 1.45 that is trading at $17.50 and pays a dividend of $0.80 annually and expected sustained dividend growth of 5.80% for the foreseeable future. The expected return on the market is 10.7% and the risk free rate is 4.1%. When measuring the expected return on equity, you decide to weight the return generated by CAPM at 80% and the Gordon Growth model at 20%.
What is the Cost of Debt for the QRS corporation (do not round until the final answer)?
What is the Cost of Equity for the QRS Corporation (do not round until the final answer)?
What is QRS Corporation's Weight of Preferred (do not round until the final answer)?
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