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The effect of tax rate on WACC K. Bell Jewelers wishes to explore the effect on its cost of capital of the rate at which the company parys taxes. The firm wishes to maintain a capital structure of 25% debt, 15% preferred stock, and 60% common stock. The cost of financing with retained earnings is 15%, the cost of preferred stock financing is 12%, and the bofore-tax cost of debt financing is 9%. Calculate the weighted average cost of capital (WaCC) given a fax rafe of 30%. The firm's WACC is 4. (Round to two decimal places.) The effect of tax rate on WACC K. Bell Jewelers wishes to explore the effect on its cost of capital of the rate a which the company pays taxes. The firm wishes to maintain a capital structure of 30% debt, 15% preferred stock and 55% common stock. The cost of financing with retained earnings is 17%, the cost of preferred stock financing is 11%, and the before-tax cost of debt financing is 6%. Calculate the weighted average cost of capital (WACC) given a tax rate of 35% The firm's WACC is \%. (Round to two decimal places.)