BALANCE SHEET

Cash $1,789,298$ Accounts Payable and Accruals $28,204,824$

Accounts Receivable $52,740,911$ Notes Payable $48,240,305$

Inventories $70,670,223$ Long$-$Term Debt $77,260,000$

Preferred Stock $15,000,000$

Net Fixed Assets $179,040,000$ Common Equity $135,535,303$

Total Assets $304,240,432$ Total Liabilities & Equity $304,240,432$

Market Values of Capital

$$ The company has $81,000$ bonds with a $30-$year life outstanding, with $15$ years until

maturity. The bonds carry a $10$ percent semi$-$annual coupon, and are currently selling

for $$899\mathrm{.}24.$

$$ The company also has $150,000$ shares of $$100$ par, $9\%$ dividend perpetual preferred

stock outstanding. The current market price is $$90\mathrm{.}00.$ Any new issues of preferred

stock would incur a $3\mathrm{.}6\%$ per share flotation cost.

$$ The company has $5$ million shares of common stock outstanding with a current price

of $$29\mathrm{.}84$ per share. The stock exhibits a constant growth rate of $10$ percent. The last

dividend $($D$0)$ was $$\mathrm{.}80.$ New stock could be sold with flotation costs of $6\mathrm{.}7\%$ per

share.

$$ The risk$-$free rate is currently $6$ percent, and the rate of return on the stock market as a

whole is $13$ percent. Your stock$$s beta is $1\mathrm{.}18.$

$$ Your firm does not use notes payable for long$-$term financing.

$$ Your firm$$s federal $+$ state marginal tax rate is $28\%.$

$$ For all projects, the reinvestment rate shall be $9\mathrm{.}5\%$