Adjusted WACC. Lewis runs an outdoor adventure company and wants to know what effect a tax change will have on his company's WACC. Currently, Lewis has the following financing pattern:

Equity: 25% and cost of 19.76%

Preferred stock: 19% and cost of 15.28%

Debt: 56% and cost of 13.3% before taxes

What is the adjusted WACC for Lewis if the tax rate is

a. 40%?

What is the adjusted WACC for Lewis if the tax rate is 40%?