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19 Phillips Equipment Inc. has 67,000 bonds outstanding that are each selling at $1,056...

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Phillips Equipment Inc. has $67, 000$ bonds outstanding that are each selling at $ $1, 056$ in the market. Each bond has $8$ years left to maturity, a $ $1000$ face value and a coupon rate of $5 % .$ Coupons are paid semiannually. The company also has $2.0$ million shares of common stock outstanding. The common stock has a beta of $1.25$ and sells for $ $41$ a share. The U $.$ S $.$ Treasury bill is yielding $2.8$ percent and the return on the market is $9.5$ percent. The corporate tax rate is $35$ percent.

$($ a $)$ Determine the firms market value weight for debt $($ Enter answers as a $%$ to $2$ decimal places $), %$

$($ b $)$ Determine the firms market value weight for equity $($ Enter answers as a $%$ to $2$ decimal places $) %$

$($ c $)$ What is the firms after tax cost of debt? $($ Enter answers as a $%$ to $2$ decimal places $) %$

$($ d $)$ What is the firms cost of equity? $($ Enter answers as a $%$ to $2$ decimal places $) %$

$($ e $)$ Using the information you have found in the earlier parts, determine the Cost of Capital for Phillips Equipment Inc. $($ Enter answers as a $%$ to $2$ decimal places $) %$

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