Given the following information, calculate the weighted average cost of capital for Puppet Corporation. (Round intermediate...

  

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Given the following information, calculate the weighted average cost of capital for Puppet Corporation. (Round intermediate calculations to 2 decimal places. Round the final answers to 2 decimal places) Percent of capital structure: Debt Preferred stock Common equity Additional information: Bond coupon rate Bond yield Bond flotation cost Dividend, expected common Price, common Dividend, preferred Flotation cost, preferred Flotation cost, common Corporate growth rate Corporate tax rate 30x 60 10 % 8.5% 8.50% 2% $2.00 $32.00 63 3% 4.50% 45 35% a. Calculate the cost of capital assuming use of internally generated funds. Internal capital cost b. Calculate the cost of capital assuming use of externally generated funds. External capital cost Given the following information, calculate the weighted average cost of capital for Puppet Corporation. (Round intermediate calculations to 2 decimal places. Round the final answers to 2 decimal places) Percent of capital structure: Debt Preferred stock Common equity Additional information: Bond coupon rate Bond yield Bond flotation cost Dividend, expected common Price, common Dividend, preferred Flotation cost, preferred Flotation cost, common Corporate growth rate Corporate tax rate 30x 60 10 % 8.5% 8.50% 2% $2.00 $32.00 63 3% 4.50% 45 35% a. Calculate the cost of capital assuming use of internally generated funds. Internal capital cost b. Calculate the cost of capital assuming use of externally generated funds. External capital cost

Answer rating: 100% (QA)

To calculate the weighted average cost of capital WACC for Puppet Corporation we need to determine the cost of each component of capital and their res... View the full answer