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Homework answers / question archive / Consider the following data to resolve problems 1 through 5

Consider the following data to resolve problems 1 through 5.

A. The investment capital of Executive Consultants, Inc. is as follows:

source of capital capital Debt 4100000 preferred shares 2200000 common shares 2800000

B. To generate the $4.1 million corporate bond capital, they issued bonds at $965 of the even value, with an annual coupon of $100 for the next 10 years, with a cost of issuance (flotation cost) of $10 per bond.

C. Issuance of preferred shares costs $5 per share and will pay a dividend of 10% of its even value of $110 per preferred access.

D. The risk-free rate is 3.45% and the market yield is 11.25%. The company's beta coefficient is 1.23.

E. Consultants, Inc. has a 35% tax liability.

__Problems__:

To receive the score for your answer, you need to submit the procedure and all calculations.

1. Determine the capital structure of Executive Consultants, Inc. **(10 points)**

2. Calculate the cost of debt. **(10 points)**

3. Calculate the cost of preferential capital. **(10 points)**

4. Calculate the cost of equity (common shares). **(10 puntos)**

5. Determine the weighted average capital cost (WACC) for the signature. **(10 points)**

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