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    Capital Structure Weight of Preferred Stock

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    Wild Wings has 80,000 shares of common stock outstanding at a price of $28 a share. It also has 15,000 shares of preferred stock outstanding at a price of $63 a share. There are 500 - 8.5 percent bonds outstanding that are priced at par. The bonds mature in 14 years, pay interest semiannually, and have a face value of $1,000. What is the capital structure weight of the preferred stock?

    1. 18.87%

    2. 21.21%

    3. 25.64%

    4. 26.29%

    5. 32.18%

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    Answer: 3. 25.64%

    Value of common ...

    Solution Summary

    Answers a multiple choice question on capital structure weight of the preferred stock.

    $2.49

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