The answer I have is incorrect. The common stock of Moe\'s Restaurant is current

Question

The answer I have is incorrect.

The common stock of Moe's Restaurant is currently selling for dollar 80 per share, has a book value of dollar 57 per share, and there are 1.16 million shares of common stock outstanding. In addition, the firm also has 112,000 bonds outstanding with a par value of dollar 1,000 that are selling at 111 percent of par. What are the capital structure weights that Moe's should use to analyze its capital structure? The weight of the debt in the capital structure is 42.74 percentage. (Round to two decimal places.)

Explanation / Answer

Common stock outstanding = 1.6 million shares

Selling price = $80

Common stock =$ 128,000,000

Bonds outstanding = 112,000

Selling price = $1110

Bonds = 124,320,000

Total capital structure =128000000 + 124320000 = 252320000

Weight of debt in capital structure = 124320000 / 252320000 * 100

= 49.27 %

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