Determine what the optimum capital structure is for Apple, Inc. The spreadsheet will use Hamada’s Equation to recalculate the levered betas based on the weights that you choose. You must explain and reference how you chose your numbers and attach a copy of the spreadsheet.
NOTE: You cannot just assume that your weights and your bond values are the same as the sample. You must choose the appropriate weights first based on the market value weights your firm currently has. Then, you must choose appropriate bond rates as you increase or decrease the weight for debt.
You must explain and reference how you chose your numbers and attach a copy of the spreadsheet.
Cost of Debt = Interest Expense/ Total Book Value of Debt
Cost of Debt= 1456/ 75680= 1.9239%
Market Value Debt= Short term + Long Term
Market Value Debt= $11302 million +64378 million= $75680 million
= D/ (E + D)
= 75680/ (798030.50 + 75680) = 0.0866
Is there a way to e-mail the attachment? The size of it will not let me post it.