This paper circulates around the core theme of ACCOUTING 2 – Kahn Inc. has a target capital structure of 60 percent equity together with its essential aspects. It has been reviewed and purchased by the majority of students thus, this paper is rated 4.8 out of 5 points by the students. In addition to this, the price of this paper commences from £ 59. To get this paper written from the scratch, order this assignment now. 100% confidential, 100% plagiarism-free.
. Kahn Inc. has a target capital structure of 60 percent equity and 40 percent debt to fund its $10 billion in operating assets. Furthermore, Kahn Inc. has a weighted average cost of capital (WACC) of 13 percent, its before-tax cost of debt is 10 percent, and its tax rate is 40 percent. The companyâs retained earnings are adequate to fund the common equity portion of the capital budget. The firmâs expected dividend next year (D1) is $3 and the current stock price is $35.a. What is the companyâs expected growth rate?b. If the firmâs net income is expected to be $1.1 billion, what portion of its net income is the firm expected to pay out as dividends?