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Your task is to calculate weighted average cost of capital (WACC] for a company. You will also calculate interim variables along the way. The company
Your task is to calculate weighted average cost of capital (WACC] for a company. You will also calculate interim variables along the way. The company has 875,000 shares of preferred stock outstanding, these shares trade at $20.00 per share. The company has 28,000 bonds outstanding; each bond is priced at $1250.00 per bond. The company has 593,750 shares of common stock outstanding; each share trades at $80.00 per share. The yield to maturity on the bonds is 8.00%. The preferred stock's perpetual dividend per share is $2.00. The common stock's beta is 1.2, the risk-free rate is 3.00%, and the market risk premium (Rm minus Rf] is 9.00%. The firm's tax rate is 25.00%. This company's after-tax cost of debt is %. [Round your answer to two decimals.] This company's cost of preferred stock is %. [Round your answer to two decimals.] This company's cost of common stock is %. [Round your answer to two decimals.] This company's weighted-average cost of capital is%. [Round your answer to four (yes, four) decimals.] Print Clear all Check
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