Town Beverage has 8 million shares of common stock outstanding, 6 million shares of preferred stock...

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Finance

Town Beverage has 8 million shares of common stock outstanding,6 million shares of preferred stock outstanding, and 5 thousandbonds. If the common shares are selling for $20 per share, thepreferred shares are selling for $10 per share, and the bonds areselling for 105 percent of par, what would be the weight used forpreferred stock in the computation of Town Beverage's WACC?
A. 26.64% B. 27.27% C. 29.85% D. 33.33% E. 42.84%
Echo Sound has 4 million shares of common stock outstanding,500,000 shares of preferred stock
outstanding, and 45,000 bonds. If the common shares are selling for$28.50 per share, the preferred shares
are selling for $38.75 per share, and the bonds are selling for96.85 percent of par, what would be the weight
used for debt in the computation of Echo Sound's WACC?
A. less than 22.70 percent
B. more than 22.70 percent but less than 24.15 percent
C. more than 24.15 percent but less than 25.60 percent
D. more than 25.60 percent but less than 27.05 percent
E. more than 27.05 percent

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Answer to Question 1 2664 Debt Number of bonds outstanding 5000 Par Value 1000 Current Price per bond 105 Par Value Current Price per bond 105 1000 Current Price per bond 1050 Market Value of Debt Current Price per bond Number of bonds outstanding Market Value of Debt 1050 5000 Market Value of Debt 5250000 Preferred Stock Number of shares outstanding 6000000 Current Price per share 10 Market Value of Preferred Stock Number of shares outstanding Current See Answer

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Town Beverage has 8 million shares of common stock outstanding,6 million shares of preferred stock outstanding, and 5 thousandbonds. If the common shares are selling for $20 per share, thepreferred shares are selling for $10 per share, and the bonds areselling for 105 percent of par, what would be the weight used forpreferred stock in the computation of Town Beverage's WACC?A. 26.64% B. 27.27% C. 29.85% D. 33.33% E. 42.84%Echo Sound has 4 million shares of common stock outstanding,500,000 shares of preferred stockoutstanding, and 45,000 bonds. If the common shares are selling for$28.50 per share, the preferred sharesare selling for $38.75 per share, and the bonds are selling for96.85 percent of par, what would be the weightused for debt in the computation of Echo Sound's WACC?A. less than 22.70 percentB. more than 22.70 percent but less than 24.15 percentC. more than 24.15 percent but less than 25.60 percentD. more than 25.60 percent but less than 27.05 percentE. more than 27.05 percent