Limoilou Corp. uses no debt. The weighted average cost of capital is 6.7%. If the current market value of the equity is $28 million and there are no taxes, what is EBIT? (Omit $ sign in your response.) EBIT $
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A: COST OF EQUITY = 10.80% AFTER TAX COST OF DEBT = 5.10% DEBT TO EQUITY RATIO = 0.80
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A: Hi, there, Thanks for posting the question. As per our Q&A honour code, we must answer the first…
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A: Weighted Average Cost of Capital = 9.9% or 0.099Market Value of the Equity = $18,500,000Tax Rate =…
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A: Data given : Debt-equity ratio = 1.7:1 WACC = 8.1% Cost of debt = 5.7% Corporate tax rate = 23%
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A: EBIT =$100 million Tax=35% Cost of equity =10% Cost of Debt =6%
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A: Given EBIT = $1980000 Cost of capital = 9%
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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:
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- Thrice Corp. uses no debt. The weighted average cost of capital is 4.8 percent. If the current market value of the equity is $23 million and there are no taxes, what is EBIT? (Do not round intermediate calculations and enter your answer in dollars, not millions of dollars, e.g. 1,234,567.)Lamont Corp. is debt-free and has a weighted average cost of capital of 12.7 percent. The current market value of the equity is $2.3 million and there are no taxes. According to M&M Proposition I, what will be the value of the company if it changes to a debt-equity ratio of .85?Sugar Skull Corporation uses no debt. The weighted average cost of capital is 8 percent. If the current market value of the equity is $13 million and there are no taxes, what is EBIT? (Do not round intermediate calculations and enter your answer in dollars, not millions of dollars, rounded to the nearest whole number, e.g., 1,234,567.) What is the EBIT
- LMNOP Corporation uses no debt. The weighted average cost of capital is 9.2 percent. If the current market value of the equity is $31.7 million and there are no taxes, what is EBIT? Round to the nearest dollar and format as "X,XXX,XXX"Gunnar Corp uses no debt. The weighted average cost of capital is 9 percent. If the current market value of the equity is $37 million and there are no taxes, what is the cost of equity for this corporation? 8% 7% 6% 9%Wako and Sons Inc. has no debt, a WACC of 14% and a tax rate of 40%. If the company chooses to change its capital structure to a debt equity ratio of 40% (D/E=0.4), what is the new cost of equity RE? a. 17.4% b. 22.4% c. 19.0% d. 19.6% e. None of the above.
- Roy's Welding has a cost of equity of 14.1 percent and a pretax cost of debt of 7.7 percent. The required return on the assets is 13.2 percent. What is the debt-equity ratio based on M&M II with no taxes?Shadow Corp. has no debt but can borrow at 7.9 percent. The firm's WACC is currently 9.7 percent, and the tax rate is 23 percent. a. c. What is the firm's cost of equity? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b. If the firm converts to 35 percent debt, what will its cost of equity be? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) If the firm converts to 50 percent debt, what will its cost of equity be? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) d-1. If the firm converts to 35 percent debt, what will the company's WACC be? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) d-2. If the firm converts to 50 percent debt, what will the company's WACC be? (Do not round intermediate calculations and…Thrice Corp. uses no debt. The weighted average cost of capital is 9.9 percent. The current market value of the equity is $18.5 million and the corporate tax rate is 25 percent. What is EBIT? (Do not round intermediate calculations. Enter your answer in dollars, not millions of dollars, rounded to 2 decimal places, e.g., 1,234,567.89.)
- The Rivoli Company has no debt outstanding, and its financial position is given by the following data: Expected EBIT = $600,000Growth rate in EBIT gL = 0% Cost of equity, rs = 10%Shares outstanding, n0 = 200,000 Tax rate, T (federal-plus-state) = 25% a. What is Rivoli’s intrinsic value of operations (i.e., its unlevered value)? What is its intrinsic stock price? Its earnings per share?b. . Rivoli is considering selling bonds and simultaneously repurchasing some of its stock. If it moves to a capital structure with 30% debt based on market values, its cost of equity , rs, will increase to 12% to reflect the increased risk. Bonds can be sold at a cost, rd, of 7%. Based on the new capital structure, what is the new weighted average cost of capital? What is the levered value of the firm? What is th amount of debt?c. Based on the new capital structure, what is the new stock price? What is the remain-ing number of shares? What is the new earnings per share?Coxx, Inc., has a debt-value ratio of 0.75. The firm’s weighted average cost of capital is 12 percent, and its current cost of equity is 18 percent. Coxx has no preferred stocks in its capital structure. The tax rate is 40 percent. What is the company’s before-tax cost of debt? Group of answer choices 10% 11% 16.67% 13.1%Fama’s Llamas has a weighted average cost of capital of 8.4 percent. The company’s cost of equity is 11 percent, and its pretax cost of debt is 5.8 percent. The tax rate is 25 percent. What is the company’s target debt-equity ratio? (Do not round intermediate calculations and round your answer to 4 decimal places, e.g., 32.1616.)
