### Computation of the weighted average cost of capital

Assignment Help Finance Basics
##### Reference no: EM1314247

Computation of the weighted average cost of capital

Jake's Sound Systems has 210,000 shares of common stock outstanding at a market price of \$36 a share. Last month, Jake's paid an annual dividend in the amount of \$1.593 per share. The dividend growth rate is 4%. Jake's also has 6,000 bonds outstanding with a face value of \$1,000 per bond. The bonds carry a 7 % coupon, pay interest annually, and mature in 4.89 years. The bonds are selling at 99% of face value. The company's tax rate is 34%. What is Jake's weighted average cost of capital?

### Write a Review

#### Computation of ebit

Computation of EBIT - mathermatically, EPS indifference point,  graphically and Calculate the EBIT-EPS indifference point and Compute the EBIT-EPS indifference point

#### Computation of the cost of equity using capm

Computation of the cost of equity using CAPM and What is the cost of the firm's common stock equity

#### Computation of after-tax cost of debt

Computation of after-tax cost of debt is planning to place privately with a large insurance company

#### Computation of value of bond

Computation of Value of Bond and The coupon rate is 8% and the time to maturity is 20 years

#### Evaluate the basis for the payment to the lender

Evaluate the basis for the payment to the lender and basis for the payment to the company-counterparty.

#### Meaning as well as importance of bottlenecks

Meaning as well as Importance of Bottlenecks and identifying the main premise of the book and important issues raised in the book

#### Computation of npv of lump sum future receipt

Computation of NPV of lump sum future receipt and annuity receipts also How much should Mr. & Mrs. Smith deposit now in a bank account paying 9 percent to reach financial happiness during retirement

#### Explaining cash management firm-s-opportunity cost is given

As the bank is also doing lot of record keeping, firm’s administrative cost would reduce by \$2,000 per month. What suggestion would you provide firm with respect to proposed cash management suppose the firm’s opportunity cost is 12%?

#### Computation of present value of cash flows to make purchase

Computation of present value of cash flows to make purchase decision where demand is so high for Anderson Electric's products that the company cannot manufacture enough inventory to satisfy demand

#### Probability of completing exam in one hour or less

Determine the probability of completing exam in one hour or less?

#### Computing the firms share price with the help of price

Computing the firms share price with the help of price earnings ratio and Perez Electronics Corp. has reported that its net income for 2006 is \$1,276,351

#### It is true that vertical integration involves the competitor

it is is true that Vertical integration involves the acquisition of competitors and Synergy is a common motive for mergers