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Inessa [10]
3 years ago
13

Tom and Jerry's has 2.4 million shares of common stock outstanding, 2.4 million shares of preferred stock outstanding, and 14.00

thousand bonds. If the common shares are selling for $13.40 per share, the preferred share are selling for $10.40 per share, and the bonds are selling for 99.96 percent of par, what would be the weight used for common stock in the computation of Tom and Jerry's WACC
Business
1 answer:
3241004551 [841]3 years ago
6 0

Answer:

Tom and Jerry's

The weight used for common stock in the computation of Tom and Jerry's WACC is:

= 45.22%

Explanation:

a) Data and Calculations:

                                               Common   Preferred    Bonds

                                                  Stock         Stock

Outstanding number               2.4 m         2.4 m         14,000

Market price per share           $13.40      $10.40         $999.6

Total value                               $32.16 m  $24.96 m    $13,994,400

Total value of stock and bonds = $71,114,400

Weight of common stock = $32.16/$71.1144 * 100 = 45.22%

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Answer:

The intrinsic value of a share today is $16.87

Explanation:

Intrinsic Value of the share is calculated as below.

Dividend Valuation method is used to value the stock price of a company based on the dividend paid, its growth rate and rate of return. The price is calculated by calculating present value of future dividend payment.

Value of Share = Dividend / (Rate of return - Growth rate)

placing values in the formula

Value of share = $2 / (14% - 6%) = $25

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Explanation:

This is a marketing strategy that some companies employ whereby they aim to distinguish their products from that of competitors by giving it certain features that expound on its strength in the market.

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Answer:

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Explanation:

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An unexpected change in the price of a key input will shift the entire SRAS curve either to the right (price of key input decreases) or to the left (price of key input increases).

3 0
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<u>medically speaking, Yes!</u>

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