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I'm having a hard time completing this equation. Need to find the After Tax Weighted Average Cost of Capital (WACC). Below is the info. Here

I'm having a hard time completing this equation. Need to find the After Tax Weighted Average Cost of Capital (WACC). Below is the info.

Here is the given information:

Cost of Debt (Before tax)

9.00%

Cost of Equity

16.00%

Percentage of debt capital

60.00%

Percentage of Equity capital

40.00%

Tax rate

35.00%

Value $100,000

After tax WACC Formula = (E/V * Ke) + (D/V) * Kd * (1 - Tax rate)

  1. E = Market Value of Equity.
  2. V = Total market value of equity & debt.
  3. Ke = Cost of Equity.
  4. D = Market Value of Debt.
  5. Kd = Cost of Debt.
  6. Tax Rate = Corporate Tax Rate.

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