The following data pertains to Radek Corp , a manufacturer of office supplies Dollar amounts in thousands Total assets $8,731 Interest bearing debt $4,239 Average borrowing rate for debt 10 0 Common equity Book value $3,130 Market value $16,284 Marginal income tax rate 35 Market equity beta 1 33 De...

Answer A Weight of debt capital 2065 Solution To ...

The following data pertains to Radek Corp., a manufacturer of office supplies. Dollar amounts in thousands. Total

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The following data pertains to Radek Corp., a manufacturer of office supplies. Dollar amounts in thousands.

Total assets	$8,731
Interest-bearing debt	$4,239
Average borrowing rate for debt	10.0%
Common equity:
Book value	$3,130
Market value	$16,284
Marginal income tax rate	35%
Market equity beta	1.33

Determine the weight on debt capital that should be used to calculate Radek's weighted-average cost of capital.

Select one:

A. 20.65%

B. 52.54%

C. 26.03%

D. 57.52%

Related Book For answer-question

Financial ACCT2

ISBN: 978-1111530761

2nd edition

Authors: Norman H. Godwin, C. Wayne Alderman

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Posted Date: Jan 14, 2021 02:04 AM

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The following data pertains to Radek Corp., a manufacturer of office supplies. Dollar amounts in thousands. Total

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