X Question 2.docx X W gmail Yahoo Canada Search Rex Chance question Chegg.com 173/Question-2dood#question My Home 7 My Home Other YouTube SSO Logout Page Connect M Gmail ocuments to earn a free unlock. Helpful Unhelpful 125% Page: 1 of 2 Question 2 The Mackie MFG Company is trying to determine its weighted average cost of capital for use in making several investment decisions. The firm's bonds were issued 6 years ago and have 14 years left until maturity. They carry a coupon rate of 12% but its investment dealer has informed the company that the yield to maturity for bonds of equal risk is currently 11%. Flotation costs for new debt will be 4 % of the amount issued. The firm's preferred stock is selling at $60 per share and has been yielding 4% in the current market. Mackie's investment dealer has stated that issue costs for new preferred will be 5% The firm will need to sell new common stock to finance the project it is now considering. Mackie common stock paid a dividend last year of $2.00 per share. Common share dividends are expected to maintain a growth rate of 6% for the foreseeable future. The stock is currently priced at $20 per share, and new common stock will have flotation costs of 5% Required Calculate the company's weighted average cost of capital assuming the optional capital structure is 40% debt, 10% preferred stock and 50% equity. Their tax rate is 40% Question 3 Ask Expert Tutors T-1.-A.-L-1.-:-1--11-- You can ask 6 questions - 021-04-1pg PHOTO-2021-04-1.jpg PHOTO-2021:04.jpg PHOTO-2021-04-1.jpg PHOTO-2021-04-1.jpg EP - o A S PIRE Pau Insert % 2 & 6 7 8. 2 9 3 0 V4 Y U X Question 2.docx X W gmail Yahoo Canada Search Rex Chance question Chegg.com 173/Question-2dood#question My Home 7 My Home Other YouTube SSO Logout Page Connect M Gmail ocuments to earn a free unlock. Helpful Unhelpful 125% Page: 1 of 2 Question 2 The Mackie MFG Company is trying to determine its weighted average cost of capital for use in making several investment decisions. The firm's bonds were issued 6 years ago and have 14 years left until maturity. They carry a coupon rate of 12% but its investment dealer has informed the company that the yield to maturity for bonds of equal risk is currently 11%. Flotation costs for new debt will be 4 % of the amount issued. The firm's preferred stock is selling at $60 per share and has been yielding 4% in the current market. Mackie's investment dealer has stated that issue costs for new preferred will be 5% The firm will need to sell new common stock to finance the project it is now considering. Mackie common stock paid a dividend last year of $2.00 per share. Common share dividends are expected to maintain a growth rate of 6% for the foreseeable future. The stock is currently priced at $20 per share, and new common stock will have flotation costs of 5% Required Calculate the company's weighted average cost of capital assuming the optional capital structure is 40% debt, 10% preferred stock and 50% equity. Their tax rate is 40% Question 3 Ask Expert Tutors T-1.-A.-L-1.-:-1--11-- You can ask 6 questions - 021-04-1pg PHOTO-2021-04-1.jpg PHOTO-2021:04.jpg PHOTO-2021-04-1.jpg PHOTO-2021-04-1.jpg EP - o A S PIRE Pau Insert % 2 & 6 7 8. 2 9 3 0 V4 Y U
