Computek College

Assignment$-2$

Following are the details regarding the capital structure of a company:

Sources of Funds Book Value $ Market Value Specific Source of Capital

Debentures $4,00,0003,80,0005\%$

Preference Capital $1,00,0001,10,0008\%$

Equity Capital $6,00,0009,00,00013\%$

Retained Earnings $2,00,0003,00,0009\%$

Total $13,00,00016,90,000$

You are required to determine the weighted average cost of capital using

$($a$)$ Book Value Weights

$($b$)$ Market Value Weights