I am in a test at this moment and wondered if you could answer one more question question for me
May 3rd, 2015
Use the following data for
securities issued by Vandelay Industries to answer questions 1 - 5: Bonds: The company issued 240,000
bonds. The bonds have a $1,000 face value with 7.5% coupons with annual
payments, 20 years to maturity, and currently sell for $940. The marginal
tax rate is 40%. Equity: The company has
9,000,000 shares of (common) stock outstanding, selling for $71 per
share. The company’s beta is 1.2, the risk free rate is 1%, and the
market risk premium is 10%.
What is the total market value, the percent of the company's financing debt, the percent of the company's financing equity, after-tax cost of debt, cost of equity, and weighted average cost of capital?