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DiKsa [7]
3 years ago
8

Bartlett Company's target capital structure is 40% debt, 15% preferred, and 45% common equity. The after-tax cost of debt is 6.0

0%, the cost of preferred is 7.50%, and the cost of common using reinvested earnings is 12.75%. The firm will not be issuing any new stock. You were hired as a consultant to help determine their cost of capital. What is its WACC?a. 8.98%b. 9.26%c. 9.54%d. 9.83%e. 10.12%.
Business
2 answers:
Umnica [9.8K]3 years ago
7 0

Explanation:

can you help me on a question please .Which strategy should individuals working in a diverse workplace adopt?

dezoksy [38]3 years ago
5 0

Answer:

The answer is b. 9.26%

Explanation:

The capital structure of a company consists mainly of debt and equity. In this question, preferred stock (a mixture of debt and equity), is introduced to the capital structure. The Weighted Average Cost of Capital (WACC) is a calculation that is carried out to evaluate the profitability of a company by investors or creditors. It depicts the ability of a company to generate cash flows needed to pay debt or distribute returns to their shareholders. The management of a company can also use this calculation to determine how purchasing assets or embarking on a project financed by debt or equity will impact the profitability of a company or its share price.

The calculation of WACC is carried out as follows:

E/V*Re + D/V*Rd *(1-T) where:

  • E is market value of equity
  • D is the market value of debt
  • Re is the cost of equity
  • Rd is the cost of debt
  • V: is the total market value of financing, that is E + D
  • E/V: percentage of financing that is from equity
  • T: corporate tax rate
  • D/V: percentage of financing that is from debt

From this formula, the computation of WACC is conducted as follows:

The cost of equity: 0.45 * 12.75% = 5.7375%

The cost of debt: 0.4 * 6.00% = 2.4%

The cost of preferred: 0.15 * 7.50% = 1.125%

WACC = 5.7375% + 2.4% + 1.125% = 9.2625%

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Multi-market competition occurs when two or more diversified firms:
azamat

Answer:

The correct answer is letter "D": simultaneously compete against each other in the same product areas geographic markets.

Explanation:

Multi-market competition happens when companies offering a similar product make contact in multiple markets. The level o competition shapes according to the region where the goods or services are being offered and in different markets, different consumers decide which company is taken as the preferred.

Though, the constant contact of competitors in different regions could decrease their competition since they might use their mutual help in adverse areas to be able to conduct their businesses.

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3 years ago
Direct Materials Purchases Budget
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Since there is not enough room here, I prepared an excel spreadsheet

Explanation:

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3 years ago
A peer-review board for alternative dispute resolution usually consists of: A. an equal number of employee representatives and m
kow [346]

Answer:

The answer is option A) A peer-review board for alternative dispute resolution usually consists of: an equal number of employee representatives and management appointees

Explanation:

Alternative dispute resolution is an affordable, less time consuming and less formal way of settling workplace disputes. To achieve this feat, a peer review board is constituted.

A peer review board usually consists of employers and management appointees and it could be a voluntary decision on their art to participate.

The pool of individuals nominated to be part of  the peer review board is considered objective and unbiased in their assessment of the issue to be resolved. They are also deemed skillful in the art of listening and arbitration.

8 0
3 years ago
What is the current yield for a $1000 corporate bond that pays 8.0 percent and has a current market value of $870?
alexandr402 [8]

The current yield for a corporate bond = 9.19 %

Calculation :

Amount of annual interest = face value × rate of interest

                                         =  $1000 × 8.0

                                           = 8000%

Then, Current yield = amount of annual interest / current price

                                 = 8000%  ÷ $870

                                = 9.19 %

Do corporate bonds pay interest?

Corporate bonds pay interest semi-annually, which suggests that, if the coupon is five percent, each $1000 bond can pay the bondholder a payment of $25 every six months--a total of $50 per year

What Is the Current Yield?

Current yield is an investment's annual income (interest or dividends) divided by the present price of the security. This measure examines the present price of a bond, instead of looking at its face value.

Learn more about current yield :

brainly.com/question/12909555

#SPJ4

4 0
1 year ago
Radner Shipping purchased a truck and a trailer for $90,000. An appraisal has set the fair market values of the truck and the tr
Monica [59]

Answer:

Truck $54,000

Explanation:

Basket purchase price of assets is always pro rated in ratio of their fair values

=90,000*(60,000/100,000

=54,000

Truck=$54,000

Trailer=90,000-54,000=$36,000

3 0
3 years ago
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