(Weighted average cost of capital) Crawford Enterprises is a publicly held company located in Arnold, Kansas. The firm began as a small tool and die shop but grew over its 35-year life to become a leading supplier of metal fabrication equipment used in the farm tractor industry. At the close of 2019, the firm's balance sheet appeared as follows: LOADING.... At present the firm's common stock is selling for a price equal to its book value, and the firm's bonds are selling at par. Crawford's managers estimate that the market requires a return of 15 percent on its common stock, the firm's bonds command a yield to maturity of 11 percent, and the firm faces a tax rate of 24 percent. a. What is Crawford's weighted average cost of capital? b. If Crawford's stock price were to rise such that it sold at 1.5 times book value, causing the cost of equity to fall to 13 percent, what would the firm's cost of capital be (assuming the cost of debt and tax rate do not change)? c. Crawford is considering a new business opportunity involving the acquisition of a trucking firm. What do you think the firm should do to select an appropriate cost of capital for evaluating this acquisition?

At presente firm's common stock is selling for a price equal to its book value, and the firm's bonds are selling at par. Crawford's managers estimate that the ma equires a return of 15 percent on its common stock, the firm's bonds command a yield to maturity of 11 percent, and the firm faces a tax rate of 24 percent a. What is Crawford's weighted average cost of capital? b. If Crawford's stock price were to rise such that it sold at 1.5 times book value, causing the cost of equity to fall to 13 percent, what would the firm's cost of capita (assuming the cost of debt and tax rate do not change)? c. Crawford is considering a new business opportunity involving the acquisition of a trucking firm. What do you think the firm should do to select an appropriate cos capital for evaluating t Data Table a. What is Crawford's % (Round to two (Click on the following icon in order to copy its contents into a spreadsheet.) Cash S 580,000 Accounts receivable 4,210,000 Inventories 6,700,000 Long-term debt Net property, plant, and equipment 18 586,000 Common equity Total assets $ 30.076 000 Total debt and equity $ 10.190.000 19.886.000 $ 30,076,000 Done sis grey Erin Enter your answer in the answer box and then click Check Answer me firl parts 22 remaining Clear All Check Answer 2 necessages of 15 percent com.co Croods who was price were to me o -X 5 CE 1