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Alex Ar [27]
3 years ago
10

Croft Corporation has a target capital structure of 70 percent common stock and 30 percent debt. Its cost of equity is 16 percen

t, and the cost of debt is 8 percent. The relevant tax rate is 24 percent. What is the company's WACC
Business
1 answer:
Bezzdna [24]3 years ago
5 0

Answer:

13.02%

Explanation:

Debt = 30% and Common stock = 70%

Cost of equity is 16% and debt is 8%

Tax is 24%

WACC = Cost of equity*Weight of equity + After tax cost of debt*Weight of debt

WACC = (0.16*0.70) + (0.08*(1-0.24)*0.30)

WACC = 0.112 + 0.01824

WACC = 0.13024

WACC = 13.02%

So, the the company's WACC is 13.02%

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Answer:

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Explanation:

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The process of external recruitment is usually longer and more expensive than internal recruitment. For example, payment to publish the vacancies in any national newspapers or payment for outsourcing company that specializes in recruitment.

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Answer:

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Generally, investing activities comprises of purchasing physical assets, investing in securities and the sale of assets or securities associated with the company.

<em>Hence, a company that purchases equipment for $32,000 cash should show the transaction on the statement of cash flows under investing activities.</em>

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