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Company capital structure weights on book value basis

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Dinklage Corp. has 4 million shares of common stock outstanding. The current share price is $76, and the book value per share is $5. The company also has two bond issues outstanding. The first bond issue has a face value of $90 million, a coupon of 5 percent, and sells for 94 percent of par. The second issue has a face value of $70 million, a coupon of 6 percent, and sells for 104 percent of par. The first issue matures in 20 years, the second in 3 years. a. What are the company's capital structure weights on a book value basis?

Dinklage Corp. has 4 million shares of common stock outstanding. The current share price is $76, and the book value per share is $5. The company also has two bond issues outstanding. The first bond issue has a face value of $90 million, a coupon of 5 percent, and sells for 94 percent of par. The second issue has a face value of $70 million, a coupon of 6 percent, and sells for 104 percent of par. The first issue matures in 20 years, the second in 3 years.

a. What are the company's capital structure weights on a book value basis?

b. What are the company’s capital structure weights on a market value basis?

Reference no: EM131185087

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