Question: The balance sheet for OUS Corp is shown below. The bonds are currently selling at 97.5% of par. There are 500 shares of preferred stock outstanding and it has a current market price of $11.20. There are 6,000 shares of common stock outstanding and the latest quote was $32.35. What is the best estimate for the weights to be used when calculating the WACC?
Balance Sheet as of 12/31/11
|
Cash
|
10,000
|
Accounts payable
|
20,000
|
|
Marketable securities
|
20,000
|
Notes payable
|
10,000
|
|
Accounts Receivable
|
25,000
|
Accruals
|
15,000
|
|
Inventory
|
40,000
|
Total current liabilities
|
45,000
|
|
Total Current Assets
|
95,000
|
Long term bonds
|
10,000
|
|
|
Preferred Stock
|
5,000
|
|
|
Common stock (par + PIC)
|
50,000
|
|
|
Retained earnings
|
30,000
|
|
Net fixed assets
|
45,000
|
Total common equity
|
80,000
|
|
|
|
|
|
Total assets
|
140,000
|
Total liabilities & equity
|
140,000
|