Case Alessia's Kitchen & Co:
Alessia’s Kitchen & Co.is a publicly traded business that has 1.4 million shares of stock outstanding that sells for $20 / share. The firm’s debt is publicly traded and was recently quoted at 93 % price. It has a total face value of $5 million, and it is currently priced to yield 11%. The risk-free rate is 8%, and the market risk premium is 7%. Finance department estimated the business beta of 0.74, and a tax bracket of 34%.
Compute the WACC of the business assuming that the corporate tax rate is 34%.
Calculations and results to be uploaded in VLE.
This is an individual activity to be uploaded in VLE.