Reactive Power Generation has the following capital structure. Its corporate tax rate is 21%. Debt Security Preferred stock Common stock What is its WACC? Required Rate of Market Value Return $ 20 million 6% 20 million 8. 40 million 12 Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places WACC Answer is complete but not entirely correct. 9.03 %
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- Reactive Power Generation has the following capital structure. Its corporate tax rate is 21%. Required Rate of Return 4% 6 10 Security Debt Preferred stock Common stock Market Value $ 30 million 30 million 40 million What is its WACC? Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. WACC Answer is complete but not entirely correct. 7.29%You are given the following information on Kayla's Heavy Equipment: Profit margin Capital intensity ratio Debt-equity ratio Net income Dividends 5.4% .63 7 Sustainable growth rate $ 56,000 $ 13,800 Calculate the sustainable growth rate. (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) %You are given the following information on Kayla's Heavy Equipment: Profit margin Capital intensity ratio Debt-equity ratio 7.3% .95 1.05 %24 84,000 24 24,000 : Net income Dividends Calculate the sustainable growth rate. (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g.., 32.16.) Sustainable growth rate ***** ** 23 %23 %23 %23 %23 %23 %23
- You've collected the following information about Caccamisse, Incorporated: Sales Net income Dividends Total debt Total equity = a. Sustainable growth rate b. Additional borrowing c. Growth rate = = = = $ 330,000 $ 18,700 $ 7,500 $ 70,000 $ 101,000 a. What is the sustainable growth rate for the company? Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. b. Assuming it grows at this rate, how much new borrowing will take place in the coming year, assuming a constant debt-equity ratio? Note: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16. c. What growth rate could be supported with no outside financing at all? Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. % %You've collected the following information about Caccamisse, Incorporated: Sales Net income Dividends Total debt Total equity = = a. Sustainable growth rate b. Additional borrowing c. Growth rate $ 280,000 $ 17,700 $ 6,500 $ 60,000 $ 91,000 a. What is the sustainable growth rate for the company? Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. b. Assuming it grows at this rate, how much new borrowing will take place in the coming year, assuming a constant debt-equity ratio? Note: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16. c. What growth rate could be supported with no outside financing at all? Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. Answer is complete but not entirely correct. 24.14% $ 11,574.00 X 4.00 %You are given the following information on Kaleb's Heavy Equipment: Profit margin Capital intensity Debt-equity ratio Net income Dividends 18 $70,000 $ 15,200 Sustainable growth rate A Calculate the sustainable growth rate. (Do not round Intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
- The common stock and debt of Android Corp. are valued at $61 million and $30 million, respectively. Investors currently require a 14% return on the common stock and an 6% return on the debt. There are no taxes. Calculate the weighted average cost of capital. Enter your answer as a percentage. Do not include the percentage sign in your answers. Enter your answer rounded to 2 DECIMAL PLACES. WACC 8.62 Correct response: 11.36±0.02 Click "Verify" to proceed to the next part of the question. This question has 3 parts, so you will be clicking verify 3 times. Suppose Android Corp. had an additional $12 million of debt and had $12 million less of common stock, what would be the expected return on the stock? Assume that the change in capital structure would not affect the risk of the debt, and recall that the WACC under the initial capital structure is 11.36%. Enter your answer a percentage. Do not include the percentage sign in your answer. Enter your answer rounded to 2 DECIMAL PLACES. "E =…A company hired you as a consultant to help estimate its cost of capital. You have obtained the following data: D0 = $2.45; P0 = $28.96; and g = 4.06% (constant). What is the cost of equity from retained earnings? Do not round your intermediate calculations. Express your answer as a percent rounded to two decimal places. (For example, 4.567% should be entered as 4.57)You are given the following information on Kaleb's Heavy Equipment: Profit margin 6.3 % Capital intensity ratio .72 Debt-equity ratio .8 Net income $ 74,000 Dividends $ 15,600 Calculate the sustainable growth rate. (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
- Evans Technology has the following capital structure. Debt Common equity 30% 70 The aftertax cost of debt is 7.50 percent, and the cost of common equity (in the form of retained earnings) is 14.50 percent. a. What is the firm's weighted average cost of capital? Note: Do not round intermediate calculations. Input your answers as a percent rounded to 2 decimal places. Debt Common equity Weighted average cost of capital Weighted Cost % 0.00 % Q Search An outside consultant has suggested that because debt is cheaper than equity, the firm should switch to a capital structure that is 50 percent debt and 50 percent equity. Under this new and more debt-oriented arrangement, the aftertax cost of debt is 8.50 percent, and the cost of common equity (in the form of retained earnings) is 16.50 percent. b. Recalculate the firm's weighted average cost of capital. O ChePremier Corporation has an ROE of 15.3 percent and a payout ratio of 52 percent. What is its sustainable growth rate? Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. Sustainable growth rate %Consider the following data for the firms Acme and Apex: Equity ($ million) Debt ($ million) ROC Cost of Capital Acme 290 145 17% 9% Apex 1,450 483 15% 10% a. Calculate the economic value added for Acme and Apex (round to 2 decimal places). Economic value added for Acme $? million Economic value added for Apex $? million b. Calculate the economic value added per dollar of invested capital for Acme and Apex (round to 2 decimal places)? Economic value added for Acme per dollar Economic value added for Apex per dollar