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4 years ago

Calculate the AT- WACC with a 60% debt and 40% equity financing structure.

Business

1 answer:

worty [1.4K]4 years ago

4 0

Answer: 9.9%

Explanation:

The Weighted Average Cost of Capital (WACC) represents the cost of financing the business through debt and capital.

It is calculated as;

= (Weight of stock * cost of stock) + ( Weight of debt * after-tax cost of debt)

After tax cost of debt;

= debt interest * ( 1 - tax rate)

= 10% * ( 1 - 35%)

= 6.5%

WACC = (40% * 15%) + ( 60% * 6.5%)

= 9.9%

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Answer:

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3 years ago

Grace Food Company Contribution Income Statement for the Month of October Corn Flakes Frosted Flakes Total Amount Percent Amount

ivann1987 [24]

Answer:

$1.5 million.

Explanation:

Calculation of the amount of the break-even sales for Grace Food Company:

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Corn Flakes = $2,000,000/$2,500,000

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Frosted Flakes = $500,000/$2,500,000

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3 years ago

Suppose a government has access to the following sources of funding currently as well as over the long run:

Sidana [21]

Answer:

spending and transfer payments = $1350

so correct option is D. $1,350

fundamental revenue = $1100

so correct option is D. $1,100

Explanation:

given data

Taxes = $1,000

User charges = $100

Borrowed funds = $250

to find out

spending on goods and services and transfer payment and fundamental revenues

solution

we know that here All three taxes, User charges and Borrowed funds are the source of fund

so that we spending and transfer payments are limit that is

spending and transfer payments = Taxes + User charges + Borrowed funds

spending and transfer payments = $1000 + $100 + $250

spending and transfer payments = $1350

so correct option is D. $1,350

and

as borrow funds can not part of fundamental revenue

so that they are to be paid back

so here fundamental revenue will be

fundamental revenue = Taxes + User charges

fundamental revenue = $1000 + $100

fundamental revenue = $1100

so correct option is D. $1,100

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3 years ago

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3 years ago

which of the following is true? A. A firm with low anticipated profit will likely take on a high level of debt. B. A successful

Oksanka [162]

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