Weighted Average Cost of Capital Assignment | Homework For You
March 17th, 2020
The Paulson Company’s year-end balance sheet is shown below. Its cost of common equity is 16%, its before-tax cost of debt is 8%, and its marginal tax rate is 25%. Assume that the firm’s long-term debt sells at par value. The firm’s total debt, which is the sum of the company’s short-term debt and long-term debt, equals $1,162. The firm has 576 shares of common stock outstanding that sell for $4.00 per share
Calculate Paulson’s WACC using market-value weights. Do not round intermediate calculations. Round your answer to two decimal places. Get Finance homework help today