WACC, Financial Management

The following is the existing capital structure of Company XYZ Ltd.
Ordinary shares at Shs.10 par 1,000,000
Retained 800,000
12% preference shares Shs.10 par 400,000
16% loan Shs.100 par 300,000
Total capital employed Shs. 2,500,000
The company’s ordinary shares have a dividend cover of 3 times and pays a dividend of 10% on its ordinary share capital.
Ordinary shares sells at Shs.18
Preference shares sell at Shs.15
Debentures are selling at par. The tax rate is 30%
Compute:
a)Growth in Equity. (7 marks)
b)W.A.C.C. (8 marks)
Posted Date: 3/22/2013 12:55:38 AM | Location : Kenya







Related Discussions:- WACC, Assignment Help, Ask Question on WACC, Get Answer, Expert's Help, WACC Discussions

Write discussion on WACC
Your posts are moderated
Related Questions
Forward market evaluation Net receipt in 1 month = 240000 - 140000 = $100000 Nedwen Co requires to sell dollars at an exchange rate of 1.7829 + 0.003 = $1.7832 per £ Ster

a) TFC = $1,840 (Rent, Salaries, Admin + Power) (b) BEQ = $1,840 / $16 = 115 child places (c) Graph: Title; Axis labels; TR line; TC line and TFC line accurately drawn and la

Q. What do you mean by Sarbanes-Oxley? Sarbanes-Oxley (SOX) - Sarbanes-Oxley Act was signed into law on 30 July 2002 by President Bush. Act is designed to oversee the financial

Q. Importance of Inventory Management 1) Inventory helps in smooth and efficient running of business. 2) Inventory provide service to the customers immediately or at a short

undertake a critical review of the current academic literature to determine the reasons for benefits of and the costs to companies of cross listing.

applicablility of operating cycle of broilers[poultry] in uganda

Pros and Cons Simulation technique allows experimentation with a model of the real life system. Whenever experimenting with the system itself is risky and/or costly, simulation

The IASB is in the procedure of undertaking a comprehensive review of accounting for financial instruments, and has issued a latest financial instruments standard referred to as IF

(a) A usual cash flow diagram will incorporate the following. If you are short the CDO and then you receive a fixed amount at the initial point t o . After that you make paymen

You plan to retire in 35 years and can invest to earn 7 percent. You estimate that you will need $85,000 at the end of each year for an estimated 25 years after retirement, and you