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stranahan stranahan
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7 years ago
The following market information was gathered for the ACME corporation. The common stock is selling for $40.00 per share and there are 100,000 shares outstanding. Retained earnings equal $400,000, preferred stock has 1,000 shares outstanding selling at $120.00 per share, and 500 outstanding long-term bonds are selling for $1,035.00 each. For purposes of estimating the firm's WACC, what are the market value weights of long-term debt, preferred stock, and equity?
A) D/V = 10.27%, PS/V = 2.38%, and E/V = 87.34%
B) D/V = 10.78%, PS/V = 3.08%, and E/V = 86.14%
C) D/V = 11.16%, PS/V = 2.59%, and E/V = 86.25%
D) D/V = 33.33%, PS/V = 33.33%, and E/V = 33.33%
Textbook 
Financial Management: Core Concepts

Financial Management: Core Concepts


Edition: 2nd
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torchunicycletorchunicycle
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7 years ago
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stranahan Author
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7 years ago
Thanks Smiling Face with Open Mouth and Tightly-closed Eyes
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