财务管理基础全套配套课件沈洪涛 ch09.ppt

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1、CHAPTER9TheCostofCapitalSourcesofcapitalComponentcostsWACCAdjustingforflotationcostsAdjustingforriskWhatsourcesoflong-termcapitaldofirmsuse?CalculatingtheweightedaveragecostofcapitalWACC=wdkd(1-T)+wpkp+wcksThew’srefertothefirm’scapitalstructureweights.Thek’srefertothecostofeachcompon

2、ent.Shouldouranalysisfocusonbefore-taxorafter-taxcapitalcosts?StockholdersfocusonA-TCFs.Therefore,weshouldfocusonA-Tcapitalcosts,i.e.useA-TcostsofcapitalinWACC.Onlykdneedsadjustment,becauseinterestistaxdeductible.Shouldouranalysisfocusonhistorical(embedded)costsornew(marginal)costs?T

3、hecostofcapitalisusedprimarilytomakedecisionsthatinvolveraisingnewcapital.So,focusontoday’smarginalcosts(forWACC).Howaretheweightsdetermined?WACC=wdkd(1-T)+wpkp+wcksUseaccountingnumbersormarketvalue(bookvs.marketweights)?Useactualnumbersortargetcapitalstructure?ComponentcostofdebtWAC

4、C=wdkd(1-T)+wpkp+wckskdisthemarginalcostofdebtcapital.TheyieldtomaturityonoutstandingL-Tdebtisoftenusedasameasureofkd.Whytax-adjust,i.e.whykd(1-T)?A15-year,12%semiannualcouponbondsellsfor$1,153.72.Whatisthecostofdebt(kd)?Remember,thebondpaysasemiannualcoupon,sokd=5.0%x2=10%.INPUTSOUT

5、PUTNI/YRPMTPVFV305601000-1153.72ComponentcostofdebtInterestistaxdeductible,soA-Tkd=B-Tkd(1-T)=10%(1-0.40)=6%Usenominalrate.Flotationcostsaresmall,soignorethem.ComponentcostofpreferredstockWACC=wdkd(1-T)+wpkp+wckskpisthemarginalcostofpreferredstock.Therateofreturninvestorsrequireonthe

6、firm’spreferredstock.Whatisthecostofpreferredstock?Thecostofpreferredstockcanbesolvedbyusingthisformula:kp=Dp/Pp=$10/$111.10=9%ComponentcostofpreferredstockPreferreddividendsarenottax-deductible,sonotaxadjustmentsnecessary.Justusekp.Nominalkpisused.Ourcalculationignorespossibleflotat

7、ioncosts.Ispreferredstockmoreorlessriskytoinvestorsthandebt?Morerisky;companynotrequiredtopaypreferreddividend.However,firmstrytopaypreferreddividend.Otherwise,(1)cannotpaycommondividend,(2)difficulttoraiseadditionalfunds,(3)preferredstockholdersmaygaincontroloffirm.Whyistheyieldonpr

8、eferredstock