Compute the companys weighted average cost

Reference no: EM133716005

Question: Given the following information on Big Brothers, Inc. capital structure, compute the company's weighted average cost of capital (WACC). The company's marginal tax rate is 40%.

Round the answer to two decimal places in percentage form. (Write the percentage sign in the "units" box)

Type of Capital Percent of Capital Structure Before-Tax Component Cost
Bonds 57% 8.45%
Preferred Stock 17% 17.35%
Common Stock Please calculate it 13.63%

Reference no: EM133716005

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