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You have the information below Kostko. Determine the firm's WACC. You have the information below Kostko. Determine the firm's WACC. ytm on bonds 7.50% yesterday's
You have the information below Kostko. Determine the firm's WACC.
You have the information below Kostko. Determine the firm's WACC. | ||||
ytm on bonds | 7.50% | yesterday's common stock dividend | $2.00 | |
coupon rate on bonds | 6.50% | expected common stock growth rate | 4% | |
years to maturity on bonds | 22 | common stock price | $28.30 | |
tax rate | 24% | debt weight | 42% | |
preferred stock dividend | $2.50 | preferred stock weight | 12% | |
preferred stock price | $26.80 | common stock weight | 46% | |
What is Kostko's after-tax cost of debt? | ||||
What is Kostko's cost of preferred stock? | ||||
What is Kostko's cost of common stock? | ||||
What is Kostko's WACC? | ||||
Source: | Weight | Cost | Weight x Cost | |
debt | ||||
preferred stock | ||||
common stock | ||||
Total |
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