Question: Valuation Using the information from the table, determine the weight on debt capital that should be used to calculate Xena's weighted-average cost of capital: Xena

Valuation

Using the information from the table, determine the weight on debt capital that should be used to calculate Xena's weighted-average cost of capital:

Xena Corp.

Total Assets$23,610

Interest-Bearing Debt (market value)$11,070

Average borrowing rate for debt10.2%

Common Equity:

Book Value$6,150

Market Value$25,830

Marginal Income Tax Rate37%

Market Beta1.73

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