п»їNaples Gadgets Inc: "balance sheet" for the entire year ending 2005 (In an incredible number of dollars)
Money and securities$ 2 . 1Accounts Payable$ 1 . 2
Accounts Receivable 10. 1Accruals 1 ) 5
Products on hand 2 . 6Notes Payable. 5
Total Current Assets$ 18. 8 Total Current Debts 3. two Net Set Assets twenty nine. 1Long-term Financial debt 15. zero
Preferred Stock 4. 0
Common Inventory 1 . 0
Retained Profits 20. several
Total Possessions 43. being unfaithful Total Debts & Value 43. 9
The following data was as well provided:
1) The company's long term debt comprises entirely of any 7% semiannual bond with a maturity time of 2039. The a genuine last trading price was $1, 098. 83 per $1, 1000. 00 bond. The provides are not callable.
2) In conversation with the owners, it was highlighted that short term debt has not been an option.
3) The company's national plus state tax level is 34%.
4) You’re able to send preferred stock pays a $2. 00 dividend per quarter. It really is non-callable and has a market price of $76. twenty. Flotation cost on a fresh issue will be 10%.
5) The business's last gross was $1. 51 every share. The dividends are required to develop at a 4% annual rate intended for the foreseeable future. Naple's share current market price is $12. 50 per share. The doble value can be $1. 00 per reveal. Flotation price on a new issue will be 12%.
6) Information via a market expenditure firm provides the firm's famous beta in 2 . a few. The purchase banking organization also educated you that government T-Notes are expected to get a return of 6%. There exists a 5% as the market risk premium.
7) The company wants to retain the latest capital structure for the foreseeable future.
2) What are the amount of weight (at the company's current market value) for each in the components that should be included?
Historic Market Value
Current Market Value
15, 500, 000
one particular, 098. 83
16, 482, 450. 00
4, 1000, 000
seventy six. 20