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Given the following information for King Power Co., find the requested answers. Debt: 30,000 bonds...

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Finance

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Given the following information for King Power Co., find the requested answers. Debt: 30,000 bonds outstanding currently trading at 5950 per bond. The bonds have a 5 65% coupon rate that pays semi-annually. The bond has 20 years remaining to maturity Preferred Stock: 100.000 shares of preferred stock that pays $6.60 per share dividend and is currently trading for $90 per share. Common Stock: 1,400,000 shares with current market price of $76 per share. The firm is expected to pay a $4.55 per share dividend next year, the growth rate is 5,80%. The market risk premium is 7.70% and the risk free rate is 2 40%. The firm beta is 120 Assume a 30% tax rate. CAPM: RE = R +B(market risk premium) INSERT EQUATIONSIANSWERS IN HIGHLIGHTED CELLS!! Dividend Growth Model: Re = D/P, + 9 Preferred Stock Rp = D/P Current Market Value Capital Structure Before tax Cost of Debt After tax Cost of Debt Debt % - Debt Cost of Preferred Stock Preferred % - Preferred Cost of Equity. CAPM Cost of Equity - DGM Cost of Equity - average Equity 95 - Equity Total WACC WACC 1 2 3 4 Graphs

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