Determining capital structure weight of the firm debt


J&J Movers has 40,000 shares of common stock outstanding at a price of $34 a share. It also has 4,000 shares of prefered stock outstanding at a price of $58 a share. The firm has 9 percent, 10 year bonds outstanding with a total face value of $500,000. The bonds are currently quoted at 96 and pay interest semiannually. What is the capital structure weight of the firm's debt if the tax rate is 34 percent?

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Finance Basics: Determining capital structure weight of the firm debt
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