Determining the crypton cost of capital


Crypton electronic has a capital structure consisting of 42% common stock and 58% debt. A debt issue of $1000 par value, 5.7% bonds that mature in 15 years and pay annual interest will sell for 973. Common stock of the firm. Is currently selling for 30.43 per share and the firm expect to pay$2.25 dividend next year. Dividends have grown at the rate of 5.1% per year and are expect to continue to do so for the foreseeable future. What is Cryton's cost of capital where the firm's tax rate is 30%? What is Crypton's cost of the capital? ( round to three decimal places)

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Accounting Basics: Determining the crypton cost of capital
Reference No:- TGS0517400

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