Book value versus market value components.$$Compare$$ Trout, Inc. with Salmon$$ Enterprises, using the balance sheet of Trout and the market data of Salmon for the weights in the weighted average cost of$$ capital:$$LOADING$....$ If the$$ after$-$tax cost of debt is $9\mathrm{.}5\%$ for both companies and the cost of equity is $14\mathrm{.}91\%,$ which company has the higher$$ WACC?

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Part $1$

What is the book value adjusted WACC for$$ Trout, Inc.?

$$

enter your response here$\%($Round to two decimal$$ places.$)$

Part $2$

What is the market value adjusted WACC for Salmon$$ Enterprises?

$$

enter your response here$\%($Round to two decimal$$ places.$)$

Part $3$

Which company has the higher$$ WACC?$($Select the best$$ response.$)$

A$.$

$$Trout$,$ Inc. has a higher WACC at $13\mathrm{.}73\%$ than Salmon Enterprises with a WACC of $11\mathrm{.}06\%.$

B$.$

Salmon Enterprises has a higher WACC at $13\mathrm{.}73\%$ than$$ Trout, Inc. with a WACC of $11\mathrm{.}06\%.$

Trout, Inc.

Current$$ assets:

$$$$2$ comma $888$ comma $889$

Current$$ liabilities:

$$$$1$ comma $811$ comma $175$

$$Long$-$term assets:

$$$$10$ comma $111$ comma $111$

$$Long$-$term liabilities:

$$$$7$ comma $972$ comma $449$

Total$$ assets:

$$$$13$ comma $000$ comma $000$

$$Owners$\text{'}$ equity:

$$$$3$ comma $216$ comma $376$

Salmon Enterprises

Bonds$$ outstanding:$3$ comma $000$ selling at $$$$1$ comma $018\mathrm{.}99$

Common stock$$ outstanding:$260$ comma $000$ selling at $$$$42\mathrm{.}34$