templeton extended care facilities inc is considering the acquisition of a chain of cemeteries for $450 million. since the primary asset of this business is real estate, templeton's mangement has determined theat they will be able to borrow the majority of the money needed to buy the business. the current owners have no debt finacing but templeton plans to browwo 330 million and invest only 120 million in equity in the acquisition. what weights should templeton use in computin th wacc for this acquisition

To compute the weighted average cost of capital (WACC) for the acquisition, Templeton needs to determine the weights of debt and equity in the capital structure. The weights represent the proportion of total capital provided by each source. In this case, Templeton plans to borrow $330 million and invest $120 million in equity. Therefore, the weights can be calculated as follows:

1. Debt Weight:
Debt Weight = Debt / Total Capital
Debt Weight = $330 million / ($330 million + $120 million)
Debt Weight = $330 million / $450 million
Debt Weight ā‰ˆ 0.7333 or 73.33%

2. Equity Weight:
Equity Weight = Equity / Total Capital
Equity Weight = $120 million / ($330 million + $120 million)
Equity Weight = $120 million / $450 million
Equity Weight ā‰ˆ 0.2667 or 26.67%

Therefore, Templeton should use a debt weight of approximately 73.33% and an equity weight of approximately 26.67% when computing the WACC for this acquisition.