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What is the weighted average cost of capital for Foggy Futures Weather Forecasters? The firm is in the 4 0 % tax bracket. The optimal
What is the weighted average cost of capital for Foggy Futures Weather Forecasters? The firm is in the tax bracket. The optimal capital structure is listed below:
SOURCE OF CAPITAL WEIGHT
Debt Wd or
Preferred Stock Wps or
Common Stock Wcs or
Debt The firm can issue $ par value, coupon interest bond with a year maturity date. The bond has an average discount of $ and flotation cost of $ per bond. The selling price is $
Preferred Stock The firm can sell preferred stock with a dividend that is of the current price of $ the cost of issuing and selling the stock is expected to be $ per share
Common Stock The firm's common stock is currently selling for $ per share. The firm expects to pay cash dividends of $ per share next year. The dividends have been growing at The flotation costs amounted to $ per share.
NB: Use the intrinsic internal values rates cost of each component in the capital structure.
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