What is the weighted average cost of capital for Foggy Futures Weather Forecasters? The firm is in
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Question:
What is the weighted average cost of capital for Foggy Futures Weather Forecasters? The firm is in the tax bracket. The optimal capital structure is listed below:
SOURCE OF CAPITAL WEIGHT
Debt Wd or
Preferred Stock Wps or
Common Stock Wcs or
Debt The firm can issue $ par value, coupon interest bond with a year maturity date. The bond has an average discount of $ and flotation cost of $ per bond. The selling price is $
Preferred Stock The firm can sell preferred stock with a dividend that is of the current price of $ the cost of issuing and selling the stock is expected to be $ per share
Common Stock The firm's common stock is currently selling for $ per share. The firm expects to pay cash dividends of $ per share next year. The dividends have been growing at The flotation costs amounted to $ per share.
NB: Use the intrinsic internal values rates cost of each component in the capital structure.
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