Question: Please explain, show work, I will rate. Rory Running has 1,000,000 shares of common stock outstanding. The stock is currently selling for $80 a share.

Please explain, show work, I will rate.

Please explain, show work, I will rate. Rory Running has 1,000,000 shares

Rory Running has 1,000,000 shares of common stock outstanding. The stock is currently selling for $80 a share. The firm also has 2 bond issues outstanding. Each bond in both issues has a face value of $1,000. The first bond issue has a total face value of $500,000 and pays 6.5 percent interest annually. The bonds in the first issue are selling at 92.4 percent of face value. The second bond issue consists of 10,000 bonds which are selling for $990 each. These bonds pay 7 percent interest annually and mature in 15 years. The tax rate is 25 percent. What is the capital structure weight of the firm's equity

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!

Dale C. Bone was a member of Roscoe, LLC, an LLC organized under the laws of North Carolina. Roscoe, LLC, purchased two acres of land near the town of Apex, North Carolina. Apex approved Roscoe, LLCs...

please show work in excel 2. The Yakuza Corporation has 3 million shares of common stock outstanding with a current price of $26 and per share; 450,000 shares of preferred stock currently trading at...

This paper will be out of a total of 70 points and will contribute up to 4% of your course work marks. Two attempts are allowed in Moodle and the higher of the two attempts will be entered in the...

this is the new question! 2. Suppose the firm, described in the previous problem, paid out $95,000 in cash dividends. What is the addition to retained earnings? 3. Suppose the firm in Problem 2 had...

it is a 5 part question, please show me how you did it! Bonds: The company issued 240,000 bonds. The bonds have a $1,000 face value with 7.5% coupons with annual payments, 20 years to maturity, and...

I have a mini case study. It is in Finance. I mostly just need help with the calculations to make sure I am doing them correctly. A template was supplied. I have done half and am now stuck. I am not...

Section 6: Capital Structure (36 marks) a. Explain why component costs of debt and equity change as increased in the balance sheet. and equity change as the debt ratio is (4 marks) b. Discuss one...

SASSY, Inc. stock has a beta of 1.2, the expected return on the market is 13.5% and the current risk-free rate is 5%. What is SASSYs cost of equity? DOG, Inc. has a $20 million, 8.25%, 10 year-year...

Please solve question in 24 hours if possible Zinn Corp. has 3.50 million shares of common stock outstanding. The firm is in steady-state growth, and analysts expect the firm's earnings and dividends...

LilyMac Studios, a national chain of photography studios, is considering opening up a chain of coffee shop/art galleries. While the existing operations of the firm have a beta of 1.17, the new chain...

This assignment requires a financial analysis of an organization. All pertinent assignment details are attached to this file. For this assignment, you will be required to summarize five types of...

Suppose the following consecutive weekly prices are observed 32.0, 32.0,31.1,30.1,30.2,30.3,30.6,33.0,32.9,33.0,33.5,33.5,33.7,33.5,33.2. Calculate the annualized volatility

Antimatter Corporation has the following four items in its ending inventory : (a) Assume that Antimatter is a public company using IFRS. Determine the total value of ending inventory using the lower...

An IT system that provides the opportunity to engage with customers through various platforms, such as email, social media, live chat, and phone support, is called a ( n ) _ _ _ _ _ _ _ _ _ ....

Solve for the total current through R1. V1= 10V, 10kHz, O phase angle V2= 8V, 10kHz, 180 deg phase angle Show your solution(attach a JPG file

An electron in the n = 8 level of a C* ion emits a photon of wavelength 104 nm. Hz (a) What is the frequency of this photon in Hertz? (answer in 3 sig.figs.) (b) What is the energy of this photon in...

1. Treatment of a 0.2500-gram sample of impure potassium chloride with an excess of AgNO3resulted in the formation of 0.2912 g of AgCl. Calculate the percentage of KCl in the sample. 2. The aluminum...

III. Find the differential equation of the family of curves. (5pts. each) 1. xcos(xy)+ e" In y =c 2. ax + by =1 3. All parabolas with axis perpendicular to x-axis and the distance between focus and...

As a new member of the board of directors for a local bank, Jack Nelson was being introduced to all the employees in the home office. When he was introduced to Ruth Johnson, he was curious about her...

Realiza un cuadro comparativo donde analices y expliques: Las diferencias y semejanzas entre los diferentes tipos de auditora incluyendo la auditoria adminstrativa

Describe the governments role in personnel selection decisions, particularly in the areas of constitutional law, federal laws, executive orders, and judicial precedent. page 248

List the common methods used in selecting human resources. page 254

Discuss how the particular characteristics of a job, an organization, or an applicant affect the utility of any test. page 246