The cost of capital of a company that uses 45 percent debt that has an after-tax cost of debt of 10 percent and 55 percent equity that has a cost of 15 percent is:

Q: What is Sultan Incorporated’s WACC (in percent to two places) if it has $15,507 with 9% after-tax…

A: WACC = (Weight of debt * cost of debt) + (Weight of preferred * Cost of preferred) + (Weight of…

Q: Rich Ltd provided the following information about its capital structure and costs of capital…

A: Debt components =40% After tax cost of debt =10% Equity components =60% Cost of equity =14%

Q: From the following information compute the residual income of Frannie Ltd.  a) Reported Earnings =…

A: Residual income refers to the money you have after you've taken care of ongoing expenses like your…

Q: What is Walkeshewar's WACC if it's equity costs 11.8 percent, the cost of it's debt is 6.3 percent,…

A: WACC (weighted average cost of capital) refers to the average cost that is paid by a company to…

Q: Rain company whose tax rate is 40% has a total asset of P500,000,000 and earnings before interest…

A: Interest Payment is calculated on the debt part out of the total funds of the company. Net Income is…

Q: ford motor corporation's capital structure consists of 60% debt, 10% preferred stock, and 30% common…

A: Capital Ratio Cost Debt 60% 6.50% Preferred stock 10% 8.00% Common equity 30% 12.00%   Tax…

Q: The company’s capital structure is as follows: Debt Weight 25%, Preferred Stock Weight 25%, Common…

A: Weighted average cost of capital means the sum total of average of various cost against various…

Q: Salalah Mineral water has found that its cost of common equity capital is 18 percent, and its cost…

A: re=18%rd=8%we=60%wd=40%tax= 40%

Q: What is the company’s after-tax weighted average cost of capital if National Co. pays 25% taxes?…

A: Weight of long term liabilities (Wl) = 0.30 Weight of preferred stock (Wp) = 0.30 Weight of common…

Q: ABC company has a capital structure of $7.1 million and it is made up of $5.6 million in equity and…

A: WACC considers all the sources of finance with their respective weights

Q: overall cost of capital? :

A: Overall cost of capital = ( Percentage of debt * Cost of debt) + (Percentage of preferred stock *…

Q: A company has a total return on capital before tax of 10%. The interest rate on debt is 4% and the…

A: The company first of debt which is said to be the weighted average cost of capital which consist of…

Q: What will be the cost of capital, after tax, for a company with 60% debt and 40% equity split if…

A: The cost of capital is calculated by taking the weighted average of the after-tax costs of a…

Q: The target capital structure for J&J Manufacturing is 50% common stock, 15% preferred equity and 35%…

A: WACC means Weighted Average cost of Capital. It is calculated as follows:- WACC = (cost of common…

Q: Given the following information regarding Builtrite's capital structure, calculate its weighted…

A: WACC stands for Weighted Average Cost of Capital. It is a financial metric that represents the…

Q: what is a suggestion concerning the proprtion of debt that the firm should utilize in capital…

A: Capital structure of a firm is the debt equity structure in the company’s financing. An optimal…

Q: How much pre tax income must a company with a tax rate of 35% need to earn per share to pay out…

A: Dividend per share (D) = $2.35Tax rate (T) = 0.35Pre tax income = ?

Q: The following information relates to Maine, Inc.:                         Total assets…

A: (Economic Value added)EVA=NOPAT - (Total assets - Current liabilities)*WACC

Q: National Co.'s capital structure consists of 30% long-term liabilities, 30% preferred stock, and 40%…

A: Weighted average cost of capital is calculated as: = Sum of (Weights * Cost of instrument)

Q: Company A's cost of equity and cost of debt are 14 and 7 percent respectively. The current tax rate…

A: The cost of capital is used as a benchmark for comparing different business decisions. It's a…

Q: What will be TapDance's WACC? (Round your answer to 2 decimal places.)

A: The weighted average cost of capital represents the total cost of a company's borrowing and share…

Q: Apple’s debt-to-asset ratio is 35%. The before-tax cost of debt is 10% and the corporate tax rate is…

A: Debt to asset ratio = 35% Before tax cost of debt = 10% Tax rate = 45% WACC = 15%   Equity to asset…

Q: Mullineaux Corporation has a target capital structure of 70 percent comm 30 percent debt. Its cost…

A: WACC is the weighted cost of capital and is the weighted cost of equity and weighted cost of debt…

Q: A company's current operating income is $400,000 and cost of equity capital is estimated to be 15%…

A: There are different views how capital structure determines or influences firm value. Traditional…

Q: A company produced (after-tax) profits $1 billion. If this represents an ROE of 4%: A. its book…

A: Given: After tax profits = $1 billion ROE = 4%

Q: Idak Corp. has a pretax income of 21,000 and a 5% weighted-average cost of capital. Assets total…

A: Solution Economic value added = NOPAT - (WACC * capital invested)   Here NOPAT = Net operating…

Q: The cost of capital for a firm with a 60/40 debt/equity split, 7.6% cost of debt, 15% cost of…

A: The question is based on the concept of Cost of Capital.Cost of capital is the weighted average cost…

Q: The cost of capital is 15%, the before-tax cost of debt is 9%, and the mar-ginal income tax rate is…

A: The cost of capital is the cost of raising funds a firm has to bear. It is the weighted average cost…

Q: Suppose that TapDance, Inc.’s capital structure features 70 percent equity, 30 percent debt, and…

A: To calculate the WACC we will use the below formula   WACC = [Kd*(1-t)*Wd]+[Ke*We] Where Kd - Before…

Q: Croft Corporation has a target capital structure of 85 percent common stock and 15 percent debt. Its…

A: WACC = Cost of debt * Weight of debt + Cost of equity * Weight of equity

Q: Salalah Mineral water has found that its cost of common equity capital is 18 percent, and its cost…

A: WACC = ∑Wi*KI W is weight and K is cost of component Post tax cost of debt is used for after tax…

Q: Suppose that TapDance, Inc.'s capital structure features 60 percent equity, 40 percent debt, and…

A: Equity ratio = 60% Debt ratio = 40% Cost of equity = 11% Before tax cost of debt = 6% Tax rate = 21%…

Q: The user cost of capital: Consider the basic formula for the user cost ofcapital in the presence of…

A: Hello. Since your question has multiple sub-parts, we will solve first three sub-parts for you. If…

Q: Winter’s prefers to finance its capital spending with 35 percent debt, 25 percent internal equity,…

A: Internal equity refers to the owner’s equity.It also includes the profits and retained earnings of…

Q: If a Company has 50% of its capital structure in debt with an interest rate of 5% and 50% in equity…

A: Weighted average cost of capital = After tax cost of debt * Weight of debt + Cost of equity * Weight…

Q: weighted average cost of capital

A: WACC = (kd * (1 - t) * Wd) + (kp * Wp) + (ke * We); where, kd = Pre-tax cost of debt t = Tax rate Wd…

Q: Barton Industries has operating income for the year of $3,600,000 and a 25% tax rate. Its total…

A: Operating Income = oi = $3,600,000Tax Rate = t = 25%Capital Invested = ci = $18,000,000After Tax…

Q: The after-tax cost of debt for a firm, which has a marginal tax rate of 28% is correctly calculated…

A: Cost of debt is that cost which is incurred by the company for taking the capital through debt from…

Q: PT. Sentosa Raya uses its own capital and debt capital. The agreed cost of debt is 10% and the…

A: Value of company = Value of debt + Value of Equity  Cost of capital = Ke × We + Kd × Wd Ke = Cost of…

Q: A company's capital structure weights are 75% equity and 25% debt. The company's cost of equity is…

A: In the given question we require to compute the firm's WACC from the below given details: Weight of…

Q: Barton Industries has operating income for the year of $3,500,000 and a 25% tax rate. Its total…

A: Given information:Operating income: $3,500,000Tax: 25%Investment: $20,000,000Cost of capital : 7%