Bartlett Company's target capital structure is 40% debt, 15% preferred, and 45% common equity. The...
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Bartlett Company's target capital structure is 40% debt, 15% preferred, and 45% common equity. The after-tax cost of debt is 5.00%, the cost of preferred is 7.50%, and the cost of common using reinvested earnings is 12.00%. The firm will not be issuing any new stock. You were hired as a consultant to help determine their cost of capital. If Bartlett's corporate tax rate is 40%, what is its WACC? a. 10.12% b. 9.26% c. 9.54% d. 9.83% e. 8.53%
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