Microsoft Word - Tutorial Solutions - (For lecture 8 topic).docx

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Munmun · Accepted Answer

Calculation for WACC
WACC = Weightage of Equity * Cost of Equity + Weightage of Debt * Cost of Debt * (1 – Tax Rate)
	 
	Market Value  ($)
	Weight
	Cost (%)
	Weighted Cost (%)
	 
	 
	 
	 
	 
	Mortgage Loan
	950024
	0.1563
	7.0237
	1.0978
	Debentures
	880000
	0.1447
	7.3876
	1.0690
	Preference Shares
	500000
	0.0822
	8.163
	0.6710
	Ordinary Shares 
	3750000
	0.6168
	13.8
	8.5118
	 
	 
	 
	 
	 
	 
	6080024
	 
	 
	11.

Microsoft Word - Tutorial Solutions - (For lecture 8 topic).docx

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