60.1K

Verified Solution

Link Copied!

ch9 question 6 please answer all parts thanks!

Next question (Weighted average cost of capital) Crawford Enterprises is a publicly held company located in Arnold Kansas Thom began as a tool and die shop but grow over its 35-year ife to become a leading supplier of metal fabrication equipment used in the farm tractor industry At the dose of 2019. the firm's balance sheet appeared as follows At present ther's common stock is seting for a price equal to book value and the tem's bands are soling af par Crawford's managers estimate that the market requires a retum of 17 percent on its common stock the firm's bonde command a yield to maturity of percent and the firm facus atae rate of 27 percent a. What is Crawford's weighted average cost of captar b. 1 Crawford's stock prica were to nie such that it sold at 15 timen book value, causing the cost of equity to fail to 15 percent, what would the firm's cost of capital be (assuming the cost of debt and tax rate do not change? Crawford is considering new business opportunity evolving the oqulon at a bucking tim What do you think the form should do to select an appropriate cout of capital for evaluating this acquisition? a. What is Crawfords weighted average cost of capital Es Rund to two decimal com tor brary Clear on Tools OM 70 Cloudy motosetch o Ice sheet that the 27 percent (Click on the following icon in order to copy its contents into a spreadsheet.) Cash $ 450,000 Accounts receivable 3.960,000 Inventories 7,100,000 Long-term debt Net property, plant, and equipment 18 367,000 Common equity $ 29,877 000 Total assets Total debt and equilty Eost of capital $ 10.210.000 19,667.000 propriate cost 5 29.877.000 Done clearl

Answer & Explanation Solved by verified expert

See Answer