ou were hired as a consultant to Quigley Company, whose target capital structure is 35% debt, 10% preferred, and 55% common equity. The interest rate on new debt is 6.50%, the yield on the preferred is 6.00%, the cost of common from retained earnings is 11.25%, and the tax rate is 40%. The firm will not be issuing any new common stock. What is Quigley's WACC

Answer:

the weighted average cost of capital is 9.25%

Explanation:

The computation of the weighted average cost of capital is shown below;

= Cost of debt × weight of debt × (1 - tax rate) + cost of equity × weight of equity + cost of preferred stock × weight of preferred stock

= 35% × 6.50% × (1 - 0.40) + 11.25% × 55% + 6% × 10%

= 1.365% + 7.288% + 0.6%

= 9.25%

Hence, the weighted average cost of capital is 9.25%

The same would be considered and relevant

can you have a sloth as a pet

For the past year, Kayla, Inc., has sales of $46,382, interest expense of $3,854, cost of goods sold of $16,659, selling and administrative expense of $11,766, and depreciation of $6,415. If the tax rate is 35 percent, what is the operating cash flow

Imagine you have $30 to spend. You are thinking of buying new soccer shoes because yours
are worn out and a new video game. Which of these do you want, and which of these do you
need? Explain your answer.
Plz no links to answer

Selena Company has two products: A and B. The company uses activity-based costing. The estimated total cost and expected activity for each of the company's three activity cost pools are as follows: The activity rate under the activity-based costing system for Supporting Customers is closest to: Multiple Choice $18.53 $46.33 $21.67 $65.00