Purchase Solution

Given the following data, compute the WACC

Not what you're looking for?

Ask Custom Question

Given the following data, compute the WACC

Cost (after tax) Weights Weighted Cost
Debt (Kd) 7.70% 30%
Preferred stock (Kp) 10.81 15
Common equity (Ke)(retained earnings) 13.00 55
Weighted average cost of capital (Ka)?

Please show all computations.

Purchase this Solution
Solution Summary

The response shows the formula and the solution to the problem.

Purchase this Solution
Free BrainMass Quizzes
Marketing Management Philosophies Quiz

A test on how well a student understands the basic assumptions of marketers on buyers that will form a basis of their marketing strategies.

Motivation

This tests some key elements of major motivation theories.

Managing the Older Worker

This quiz will let you know some of the basics of dealing with older workers. This is increasingly important for managers and human resource workers as many countries are facing an increase in older people in the workforce

Learning Lean

This quiz will help you understand the basic concepts of Lean.

Six Sigma for Process Improvement

A high level understanding of Six Sigma and what it is all about. This just gives you a glimpse of Six Sigma which entails more in-depth knowledge of processes and techniques.

View More Free Quizzes
Related BrainMass Solutions

  • Given the following data, compute the Weighted average cost of capital

    56836 Given the following data, compute the Weighted average cost of capital Given the following data, compute the WACC Cost (after tax) Weights Weighted Cost Debt (Kd) 7.70% 30% Preferred stock (Kp) 10.81 15 Common equity (Ke) 13.00 55 (retained

  • Calculating equity required return and weighted average cost of capital

    Calculate the Equity Required Return, Ke Calculate the Weighted Average Cost of Capital, WACC Using the WACC calculated in the previous step, compute the project's Net Present Value, NPV, given the Cash Flows in the DATA sheet, and determine if the

  • Calculating WACC and then NPV of Projects

    The company pays a 4.5% rate for the debt. Compute the WACC of this project. [Hint: Carefully explain each step you need to compute the WACC.] To calculate the WACC, we need the cost and proportion of debt and equity. Cost of debt is given.

  • Beta of the Portfolio & WACC

    The solution computes Beta of the Portfolio and WACC with given data.

  • Weighted Average Cost of Capital (WACC)

    375494 Weighted Average Cost of Capital (WACC),. Given the following information on T & T, Inc. capital structure, compute the companyâ??s weighted average cost of capital. The company's marginal tax rate is 40%.

  • WACC, Beta

    a) Compute the WACC assuming that AI is subject to a 40% tax rate. b) Re-compute the WACC assuming that the firm has $85 M in debt and $100 M in stock.

  • Firm's WACC

    220531 Keys Company: What is the firm's WACC? You were hired as a consultant to Keys Company, and you were provided with the following data: Target capital structure: 40% debt, 10% preferred, and 50% common equity.

  • Compute WACC based on given information.

    337553 Compute WACC based on given information. A company has determined that its optimal capital structure consists of 30 percent debt and 70 percent equity. Given the following information, calculate the firm's weighted average cost of capital.

  • Shellfish processing CFO: NPV, MIRR, and WACC

    A CFO is considering a project that has the following cash flow and WACC data. What is the project's MIRR? Note that a project's projected MIRR can be less than the WACC (and even negative), in which case it will be rejected.

View More Related Solutions