Question: Can someone please help me with this spreadsheet assignment? It's about WACC. Module 13 Student's Model 12/04/16 ATLAS METALS COMPANY Establishing the Optimal Capital Budget

Can someone please help me with this spreadsheet assignment? It's about WACC.

Module 13 Student's Model 12/04/16 ATLAS METALS COMPANY Establishing the Optimal Capital Budget This case illustrates basic cost of capital calculations, the construction of the marginal cost of capital and investment opportunity schedules, and the development of the optimal capital budget. The model develops the firm's market value capital structure, component costs, MCC schedule assuming two break points and available depreciation generated funds. The model could easily be expanded to include more break points in the MCC schedule, but most firms do not precisely define their MCC break schedules past the retained earnings break point. If you are using the student version of the model, some of the cells have been blanked out. All of the formulas and inputs have been blanked out but not labels. Before using the model, it is necessary to fill in the empty cells with the appropriate formulas. Once this is done, the model is ready for use. ======= =============== =========== ======= ============== =========== INPUT DATA: KEY OUTPUT: Short-Term Debt: Total $ amount Marginal cost rate Market Value Capital Structure: $29,010,000 7.00% Long-Term Debt: Total $ amount Par value Years to maturity Coupon rate Current req return Add. sr. debt Marginal cost rate: Senior debt Junior debt $121,326,000 $1,000 10 8.00% 9.00% $41,000,000 9.50% 11.80% % short-term debt % long-term debt % preferred stock % common stock 7% 31% 9% 53% Break Points: RE BP RE+Dep BP $0 $0 Debt BP Debt+Dept BP $0 $0 Component costs: Short-term debt 0.00% Long-term debt: First interval Second interval 0.00% 0.00% Preferred Stock: Total $ amount Par value Dollar dividend $36,010,000 $100 $12.69 Flotation costs Common Stock: Common stock Retained earnings Shares outstanding Current price New issue net price $6.00 $211,140,000 $29,587,000 8,500,000 $24.84 $29.34 Preferred stock 0.00% Common stock: Retained earnings New common stock 0.00% 0.00% WACCs: First interval Second interval Third interval Other Data: Div. payout ratio Dep. expense Tax rate 1998 Earnings available to com. stockholders 1998 EPS (est) 1988 EPS growth (% previous) 0.00% 0.00% 0.00% ======= =============== =========== ======= ============== =========== MODEL-GENERATED DATA: Market Value Capital Structure: # bonds outstanding Type of Financing Market Value ------------------------- ------------------Short-term debt $29,010,000 Long term debt $121,326,000 ------------------Total debt $150,336,000 Preferred stock Common equity Total financing Retained Earnings Break Point: RE BP = RE BP inc. dep. $36,010,000 $211,140,000 ------------------$397,486,000 =========== % ---7% 31% ---38% 9% 53% ---100% ==== Debt BP = Debt BP inc, dep. Dividend Data: Div. growth rate End-of-year div. Component Costs: Short-term debt Long-term debt: First interval Second interval Preferred stock Retained earnings New common stock WACCs: First Interval: ST debt, senior LT debt, retained earnings & preferred stock Component Fraction Cost Short-term Long-term Preferred stock Retained earn Product ----WACC = Ka = Second Interval: ST debt, Senior LT debt, external equity and preferred stock Component Fraction Cost Short-term Long-term Preferred stock New CS Product ----WACC = Ka = Third Interval: ST debt, junior LT debt, external equity and preferred stock Component Fraction Cost Product Short-term Long-term Preferred stock New CS ----WACC = Ka = ======= =============== =========== ======= ============== =========== END
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