Given the Following Information for Jano Corp

question 196

Multiple Choice

Given the following information for Jano Corp. find the WACC. Assume the company's tax rate is 35%. Bonds: 10,000 7% coupon bonds outstanding, $1,000 par value, 20 years to maturity, selling
For 102 percent of par; the bonds make semi-annual payments. Common Shares: 400,000 shares
Outstanding, selling for $50 per share; the beta is 1.15. Preferred shares: 25,000 shares of 5%
Preferred stock outstanding, currently selling for $65 per share. 8% market risk premium and 4%
Risk-free rate.

• A) 9.97
• B) 10.17%
• C) 11.37%
• D) 12.57%
• E) 13.77%

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Definitions:

Posterior

Pertaining to the back side of the body or an organ, opposite of anterior.

Coracobrachialis

A muscle in the shoulder that helps in flexing and adducting the arm.

Pectoralis Major

A large muscle in the upper chest that functions in the movement of the shoulder and upper arm.

Deltoid

A large, triangular muscle covering the shoulder joint and responsible for lifting and rotating the arm.