Which one of the following statements is correct concerning the weighted average cost of capital (WACC)?
A) The pre-tax rate of return on the debt is the rate that is relevant to the computation of the WACC.
B) When computing the WACC, the weight assigned to the preferred stock is equal to the coupon rate multiplied by the par value assigned to the preferred stock.
C) A firm's WACC will decrease as their corporate tax rate decreases.
D) The weight of the common stock used in the computation of the WACC is based on the number of shares outstanding multiplied by the book value per share.
E) The weight of the debt can be based on the face value of the bond issue(s) outstanding multiplied by the quoted price(s) when expressed as a percentage of the face value.
E
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On October 1, Black Company receives a 9% interest-bearing note from Reese Company to settle a $20,000account receivable. The note is due in six months. At December 31, Black should record interest revenue of
a. $0 b. $450 c. $900 d. $1,800
Sometimes a(n) _____ is automatically created using data, such as the date and time of a transaction or the name or password of the user updating the file.
A. atomic transaction B. audit trail C. denial of service D. global transaction
What is a purpose of proactive fraud auditing?
a. It creates an atmosphere of distrust between and among employees. b. Its purpose is to deter employees from committing fraud. c. It provides ways for employees to deal with personal pressures. d. It eliminates collusion as a means of committing fraud.
A ________ is a statement describing an organization's commitment to certain standards of ethical behaviour.
A. corporate credo B. role model C. reward structure D. control system