9. The Patrick Company's cost of common equity (rs) is 16%, its before-tax cost of debt (ra) is 8%, and its marginal tax rateis 20%. The stock sells at $41 per share and bonds sell at $900 per bond.AssetsCashAccount ReceivableInventories$100,000$300,000$400,000Liabilities and EquityLong-term debt (par value-$1000)$2,000,000Common stock (par value=$1)$200,000Retained earnings$2,800,000Plant and equipment, net $4,200,000Total assets$ 5,000,000Total liabilities and equityWhat is Patrick's WACC if it raises capital based on market value capital structure?a. 12.16%$5,000,000b. 14.56%c. 14.27%d. 12.80%e. 13.88%

Given Data: No. of common Equity200000No of Long term Debt2000Market Price of Shares41Market Price…

9. The Patrick Company's cost of common equity (rs) is 16%, its before-tax cost of debt (ra) is 8%, and its marginal tax rate is 20%. The stock sells at $41 per share and bonds sell at $900 per bond. Assets Cash Account Receivable Inventories $100,000 $300,000 $400,000 Plant and equipment, net $4,200,000 Total assets $5,000,000 Liabilities and Equity Long-term debt (par value=$1000) Common stock (par value=$1) Retained earnings Total liabilities and equity What is Patrick's WACC if it raises capital based on market value capital structure? a. 12.16% b. 14.56% c. 14.27% d. 12.80% e. 13.88% $2,000,000 $200,000 $2,800,000 $5,000,000 the cost of cap