Calculate the post tax wacc from the information

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Question 1: You have collected the following information:

a. the yield on your company's preferred stock    8%

b. the yield on your company's debt   10%

c. the required return on your company's common stock and internal equity  12%

d. debt total  $5,000,000

e. preferred stock current market value  $10,000,000

f. common stock and retained earnings total value  $20,000,000

Please calculate the pre-tax weighted average cost of capital (WACC) for your company.

Question 2: Your company's marginal income tax rate is 40%. Please calculate the post tax WACC from the information provided in problem one.

Reference no: EM132432736

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