MultiSystem Corporation Limited, which is a multinational company producing Solid State Drive. The capital structure on Nov 2022 is as followed. The number of common stock outstanding was 50,000 units and valued at RM$10,000,000. The preference share valued at RM$4,000,000 and expected dividend payout is 11%. The preferred stock par value is RM$1.00 and current internal trading price is RM1.08. We have taken debenture as loan which amount to RM$7,000,000 and pay 12% as interest rate. The par value of debenture is RM$100 and Market price is RM$100. The share of the company currently is traded for RM$25. The company is expected to pay a divided of RM$2 per common share which will grow at 7% forever. The retained earnings of the company are $24,000,000, identify the cost of capital. The tax bracket for the company is 40%. Expected upcoming years dividend is projected at $2.16. Calculate the Capital Structure, Cost of capital and weighted average cost of capital (WACC).
The following Capital structure is extracted from MultiSystem Corporation Limited, which is a multinational company producing Solid State Drive. The capital structure on Nov 2022 is as followed. The number of common stock outstanding was 50,000 units and valued at RM$10,000,000. The
- Calculate the Capital structure and the
- Calculate the cost of the capital for MultiSystem’s Capital
- Calculate the weighted average cost of capital (WACC) for the existing capital
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