Answer:
38.42%
Explanation:
First, find the market value of debt( bonds in this case);
market value of debt = price of bond * number of bonds
= $1,000 * 1,500 = $1,500,000
First, find the market value of common stock;
market value of common stock = price per share * number of stock outstanding
= $26 * 36,000 = $936,000
Since debt and equity make up KHD company's capital ,
total capital = market value of debt + market value of common stock
= $1,500,000 + $936,000
= $2,436,000
Weight of the common stock = market value of common stock / total capital value;
= $936,000/ $2,436,000
= 0.3842 or 38.42% as a percentage
Therefore, What is the weight of the common stock is 38.42%
