Question

solve in excel and show = equations used not just answers

Find the cost of equity for Consolidated Wheels and Axles Inc. using the information below:
The firm's beta estimate is 0.9
The 10-year Treasury yield is 5.1%
The (expected) market risk premium is 6.3%

Compute the weighted average cost of capital using the information below:
			The effective marginal tax rate is 20%
		Weight	Cost (Rate)
	short term debt, not recurring	0.10	7.9%
	short term debt, recurring	0.15	7.5%
	long term debt	0.20	7.0%
	preferred stock	0.10	9.0%
	common equity	0.55	11.5%
	short term investments	0.05	4.7%

Answer 1

SEE THE IMAGE. ANY DOUBTS, FEEL FREE TO ASK. THUMBS UP PLEASE

ke - Microsoft Excel (Product Activation Failed) Add-Ins View - 2x Σ AutoSum : A Dr General SF Wrap Text Merge Merge & Center - Center File Home Insert Page Layout Formulas Data Review % Cut Calibri -11AA = = = Ea Copy Paste Format Painter BI U D- DA Clipboard Font B3 A B $ % % , 4:0 .00 :.: Insert Delete Format Conditional Format Formatting as Table Styles Cell Styles Fill Clear Sort & Filter Editing Find & Select Alignment Number Cells beta risk free rate market risk premium 0.9 5.10% Rf = 10 year T yield 6.30% Rm-Rf [=E16*(1-D12)] ans 1 cost of equity = 10.77% (=D5+ D4*D6] [Rf +beta*(Rm-Rf)] . [=E17*(1-012)] 11 wacc calculation 12. TAX RATE 20% 14 weights COC(%) AFTER TAX COC(%) 15 16 17 18 short term debt, recurring long term debt preferred stock common equity 0.15 0.2 0.1 0.55 7.50% 7% 9% 11.50% 6.00% 5.60% 9% 11.50% WEIGHTED COST A*C 0.90% (=D16*F16] 1.12% (=D17*F17] 0.90% (=D18*F18] 6.33% (=D19*F19] 9.25% [=SUM(G16:619)] 19 ans 2 WACC = 20 21 22 NOTE NO TAX ADJUSTMENTS ARE REQUIRED FOR PREFERRED STOCK AND COMMON STOCK 23 HIN Rea ETEMADI 513 Sheet2 DOUBLE Sheet4 Sheets Sheets 57 58 59 ORGANIC PRODUCE WACC 510 511 S1 S3 SPECIFIC 0 0 NAME DIV YIELD ferences Sheet1 B0 . Sheet3 120% 6. B 9 * * *0 ENG 05-11-2019