contestada

Dani Corporation ha 7 million hare of common tock outtanding. The current hare price i $73, and the book value per hare i $8. The company alo ha two bond iue outtanding. The firt bond iue ha a face value of $90 million, ha a coupon rate of 6 percent, and ell for 98 percent of par. The econd iue ha a face value of $75 million, ha a coupon rate of 5 percent, and ell for 110 percent of par. The firt iue mature in 22 year, the econd in 7 year. Suppoe the mot recent dividend wa $4. 45 and the dividend growth rate i 4. 8 percent. Aume that the overall cot of debt i the weighted average of that implied by the two outtanding debt iue. Both bond make emiannual payment. The tax rate i 24 percent. What i the company’ WACC?

Respuesta :

If the tax rate i 24 percent, the company’ WACC is 0.2504.

Equity is the amount of money that a company's proprietor has put into it or owns. On a enterprise's balance sheet, the distinction between its liabilities and assets suggests how a great deal fairness the corporation has. the proportion charge or a price set via valuation professionals or investors is used to discern out the equity fee.

Book value weight

Particulars                                amount [millions ]              (amount/total)

common stock                                 $56.00                            0.2534

first issue                                           $90.00                           0.4072

second issue                                      $75.00                           0.3394

Total Book value                               $221.00

Weight of equity on book value basis = 0.2534

Weight of debt on book value basis = 0.7466

                                       Market  value                               weight

Particulars                 amount [millions ]                          (amount/total)

common stock           $511.00                                          0.7496

first issue                    $88.20                                           0.1294

second issue              $82.50                                           0.1210

Total market value      $681.70

Weight of equity on market value basis = 0.7496

 Weight of debt on market value basis = 0.2504

Learn more about equity here:-https://brainly.com/question/11556132

#SPJ4

Otras preguntas