Problem 11-21 WACC Weights (LG11-4) BetterPie Industries has 3 million shares of common stock outstanding, 2 million shares of preferred stock outstanding, and 10,000 bonds. Assume the common shares are selling for $45 per share, the preferred shares are selling for $22.50 per share, and the bonds are selling for 98 percent of par.   What would be the weights used in the calculation of BetterPie’s WACC? (Do not round intermediate calculations. Round your final answer to 2 decimal places.)         Equity weight %     Preferred stock weight %     Debt weight %

EBK CFIN
6th Edition
ISBN:9781337671743
Author:BESLEY
Publisher:BESLEY
Chapter11: The Cost Of Capital
Section: Chapter Questions
Problem 3PROB
icon
Related questions
Question

Problem 11-21 WACC Weights (LG11-4)

BetterPie Industries has 3 million shares of common stock outstanding, 2 million shares of preferred stock outstanding, and 10,000 bonds. Assume the common shares are selling for $45 per share, the preferred shares are selling for $22.50 per share, and the bonds are selling for 98 percent of par.


 

What would be the weights used in the calculation of BetterPie’s WACC? (Do not round intermediate calculations. Round your final answer to 2 decimal places.)


 

   
  Equity weight %  
  Preferred stock weight %  
  Debt weight %  
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 2 steps with 2 images

Blurred answer
Knowledge Booster
Stock repurchase
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.
Recommended textbooks for you
EBK CFIN
EBK CFIN
Finance
ISBN:
9781337671743
Author:
BESLEY
Publisher:
CENGAGE LEARNING - CONSIGNMENT