P9-14 (similar to) WACC-Book weights and market weights Webster Company has compiled the information shown in the following table: E a. Calculate the weighted average cost of capital using book value weights. b. Calculate the weighted average cost of capital using market value weights. c. Compare the answers obtained in parts a and b. Explain the differences. a. The firm's weighted average cost of capital using book value weights is %. (Round to two decimal places.) 1 Data Table (Click on the icon here in order to copy the contents of the data table below into a spreadsheet.) Source of capital Book value Market value After-tax cost Long-term debt $4,000,000 $4,120,000 8% Preferred stock 40,000 60,000 12% Common stock equity 1,060,000 2,904,000 16% Totals $5,100,000 $7,084,000 Print Done