A company has $50 million in common stock, $10 million in preferred stock, and $20 million...
A company has $50 million in common stock, $10 million in preferred stock, and $20 million in outstanding bonds. What is the percentage of debt in this firm's capital structure?
Enter your answer as a percentage, without the percentage sign ('%'), rounded to 1 decimal. For example, if your answer is 0.0789, that's 7.9%, so just enter 7.9
NOTE: The answer 25.0% in INCORRECT
Homework Answers
% of debt = Value of debt/Total value of stock and debt
= 20 million/(50 million + 10 million + 20 million)
= 25%
Hence, the answer is 25.0
Don't put % sign in answer. I think that is why it is showing wrong.
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