1. Calculate WACC given the following information.

Total Value of Common Stocks (CS)	$600,000	Cost of Equity (common stocks)	0.22
Total Value of Preferred Stocks (PS)	$100,000	Cost of Preferred stock	0.14
Total Value of Debt (D)	$500,000	Pre-tax Cost of Debt	0.07
		Tax rate (t)	0.2

a. 14.50%

b. 8.16%

c. none of the answers is correct

d. 16.31%

e. 12.01%

2. Calculate WACC given the following information.

Total Value of Common Stocks (CS)	$800,000	Cost of Equity (common stocks)	0.19
Total Value of Preferred Stocks (PS)	$100,000	Cost of Preferred stock	0.13
Total Value of Debt (D)	$300,000	Pre-tax Cost of Debt	0.08
		Tax rate (t)	0.4

a. 11.39%

b. 14.95%

c. none of the answers is correct

d. 19.42%

e. 17.09%