Problem

Weight of Equity FarCry Industries, a maker of telecommunications equipment, has 2 million...

Weight of Equity FarCry Industries, a maker of telecommunications equipment, has 2 million shares of common stock outstanding, 1 million shares of preferred stock outstanding, and 10 thousand bonds.  If the common shares are selling for $27 per share, the preferred share are selling for $14.50 per share, and the bonds are selling for 98 percent of par, what would be the weight used for equity in the computation of FarCry’s WACC?

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Solutions For Problems in Chapter 11