32. ABC Company’s cost of equity is 18%, its before-tax cost of debt is 8%, and its corporate tax rate is 40%.  Given the following balance sheet, calculate the after-tax weighted-average cost of capital. Assets   Liabilities Cash P   100   Accounts payable P    200 Accounts Receivable 400   Accrued taxes due 200 Inventories 200   Long-term debt 400 Plant & equipment 1,300   Equity 1,200   P2,000     P2,000   10.3% 14.7% 9.7% 16.8%

Q: Here are book- and market-value balance sheets of the United Frypan Company (figures in $ millions):…

A:

Q: Rain company whose tax rate is 40% has a total asset of P500,000,000 and earnings before interest…

A: Interest Payment is calculated on the debt part out of the total funds of the company. Net Income is…

Q: 7. A firm has 60% of debt and 40% of equity as its capital. The cost of debt is 8%, the cost of…

A: Hey, since there are multiple questions posted, we will answer the first question. If you want any…

Q: after-tax weighted-average cost of capital

A: After-tax weighted-average cost of capital = [Cost of equity * Equity/(Equity + Long-term debt)] +…

Q: Nike, Inc., has a debt-equity ratio of 2.3.  The firm's weighted average cost of capital is 10…

A: Debt to equity ratio is 2.3, therefore, debt to total value (D/V) = 2.3/(1+2.3) = 0.696969696969697.…

Q: he Duval Corporation has recently reported the following information: Net income…

A: Formulas:

Q: Keziah Textiles, Inc. has a cost of equity of 10.8 percent. The company has an aftertax cost of debt…

A: COST OF EQUITY = 10.80% AFTER TAX COST OF DEBT = 5.10% DEBT TO EQUITY RATIO = 0.80

Q: How much of the firm's market value is accounted for by the debt-generated tax shield? (Enter your…

A: WACC: It represents the average cost of capital for the firm. It is calculated by the sum of the…

Q: Blue Ridge Tours has a cost of equity of 14.28 percent and a pre-tax cost of debt of 8.1 percent.…

A: Given: Cost of equity = 14.28% Pre tax cost of debt = 8.1% Debt-equity ratio =0.60 Tax rate = 34%

Q: Company A's cost of equity and cost of debt are 14 and 7 percent respectively. The current tax rate…

A: The cost of capital is used as a benchmark for comparing different business decisions. It's a…

Q: B & B Ltd. has a weighted average cost of capital of 10.5%. The company's cost of equity is 15.5%,…

A: The weighted average cost of capital = 10.5% Cost of equity = 15.5% pretax cost of debt = 8.5% tax…

Q: A firm’s cost of debt is 6% after tax and cost of equity is 10%. The firm’s investment in asset is…

A: WACC = (Weight of debt * cost of debt) + (Weight of equity * Cost of equity)

Q: ABC Company’s cost of equity is 18%, its before-tax cost of debt is 8%, and its corporate tax rate…

A: Cost of Equity = 18% Before Tax Cost of Debt = 8% Tax Rate = 40% Value of Equity = 1200 Value of…

Q: Key Motors has a cost of equity of 14.26 percent and an unlevered cost of capital of 11.34 percent.…

A: levered cost of equity formula: re=ru+DV-D×ru -rd×1-taxwhere,re= levered cost of equityru= unlevered…

Q: A firm has the following book-value balance sheet; Debt = $23,000, Common Stock ($1 par) = 20 and…

A: The value of tax shield is given as firm's tax rate multiplied by the cost of debt and the market…

Q: Company X has debt and equity as sources of funds. Company X has market value of debt as $150,000…

A: Weighted Average Cost of Capital is the firm’s cost of capital in each category of capital is…

Q: 42 A company has P1 million in shareholders' equity and P2 million in debt equity (8% bonds). Its…

A:

Q: A Corporation has P1,500,000 in debt outstanding. The company's before-tax cost of debt is 10%.…

A: Debt (D) = P 1500000 Interest rate = 10% Sales (S) = P 3500000 Net income (NI) = P 600000 60% is…

Q: Russell Securities has $125 million in total assets and its corporate tax rate is 40%. The company…

A:

Q: The capital structure of Bulldogs Inc. is comprised of 50% ordinary stock, 25% preferred stock, and…

A: Formula: Weighted Average Cost of Capital = (Cost of Ordinary Stock X Weightage of Ordinary Stock) +…

Q: Black Inc.'s capital structure consists entirely of long-term debt and common equity. The cost of…

A: Cost of long term debt = 5% Tax rate = 40% After tax cost of debt (RD) = 5%*(1-0.40)…

Q: Here are book- and market-value balance sheets of the United Frypan Company (figures in $ millions):…

A: a. Firm's market value accounted by the debt-generated tax shield can be calculated as follows:…

Q: Bulldogs Inc.’s capital structure consists entirely of long-term debt and common equity. The cost of…

A: Weighted average cost of capital is the average of the various cost of capital based on the weights…

Q: Here are book- and market-value balance sheets of the United Frypan Company (figures in $ millions):…

A: Weighted average cost of capital (WACC):- Weighted average cost of capital (WACC) is a method of…

Q: Nike, Inc., has a debt-equity ratio of 2.3.  The firm's weighted average cost of capital is 10…

A: Debt-equity ratio is 2.3. The debt can be expressed as:

Q: XYZ Inc. has a target capital structure of 60% equity and 40% debt. Its cost of equity is 9% and the…

A: WACC = Weight of equity * cost of equity + Weight of debt * cost of debt

Q: ABC Inc. desires to maintain a capital structure of 80% equity and 20% debt. They currently have an…

A: Weighted average cost of capital: Weighted average cost of capital is the rate at which the future…

Q: P&G has the following capital structure: $2 million in debt, $5 million in preferred stock and…

A: Here, Value of the firm is 'V' Debt is 'D' Preferred stock is 'P' Equity is 'E'

Q: Here are book- and market-value balance sheets of the United Frypan Company (figures in $ millions):…

A: Given Information: Book-Value Balance Sheet Net working capital $ 50 Debt $ 70 Long-term…

Q: A company's capital structure weights are 75% equity and 25% debt. The company's cost of equity is…

A: In the given question we require to compute the firm's WACC from the below given details: Weight of…

Q: Broward Manufacturing recently reported the following information:Net income…

A: A quantitative method that provides information about the company including its liquidity,…

Q: If the company’s Earnings before interest and taxes (EBIT) is OMR 500,000, the weighted average cost…

A: Market value of firm under net income approach  = EBIT /Cost of capital SO, EBIT  = Market value *…

Q: Fama's Llamas has a weighted average cost of capital of 9.7 percent. The company's cost of equity is…

A:

Q: The market value of Glenwood's debt and equity capital totals $180 million, 80% of which is equity…

A: Financial analysts calculate a bank's return on the investment using the weighted average cost of…

Q: Nike, Inc., has a debt-equity ratio of 2.3.  The firm's weighted average cost of capital is 10…

A: Unlevered cost of equity is the cost of raising a capital for the firm which is completely funded by…

Q: The cost of debt for firm XYZ is 6%. It's tax rate is 40%. The cost of retained earnings is 12% and…

A: Retained earnings break point is calculated using the below formula: Here, Retained earnings is…

Q: Lamas has a weighted average cost of capital of 8.4 percent. The company's equity is II percent, and…

A: The debt Equity ratio states how much debt the company has in its capital structure. Generally the…

Q: Take It All Away has a cost of equity of 10.45 percent, a pretax cost of debt of 5.21 percent, and a…

A: WACC =(cost of debt * market value weight of debt)+ (cost of equity * market value weight of equity)

Q: Taes and the Cost of Capital. Here are book- and market-value balance sheets of the United Fry pan…

A: Part (a) Firm's Value Accounted for the Debt generated tax Shield                              =…

Q: Marina Supplies has 40% debt and 60% equity in its capital structure. The firm's estimated after-tax…

A: Weighted Average Cost of Capital is the propionate cost of capital of equity and debt. The…

Q: Fama’s Llamas has a weighted average cost of capital of 8.4 percent. The company’s cost of equity is…

A: The formula used is shown:

Q: The ABC Company has a cost of equity of 21.2 percent, a pre-tax cost of debt of 5.2 percent, and a…

A: wacc=wd×rd×1-tax+we×rewhere,wd=weight of debtrd=cost of debtwe=weight of equityre=cost of equity

Q: debt and RM30,000 common stock. The before-tax cost of debt is 9% and nmon stock is 14%. If the…

A: WACC = E/D+E * (re) + D/D+E*(rd)*(1-t) where E = equity amount  D = debt amount re = cost of equity…