Please explain in 4 to 5 sentences why OPTION E is a true statement.

Thanks!!

14. Which one of the following statements is FALSE about calculating a WACC? a. If the firm's target capital structure and current capital structure differ, then the target capital structure should be used in the WACC calculation. b. Interest expense from the income statement divided by total debt from the balance sheet is one of the accepted ways to calculate the required return on debt when calculating the WACC. c. The WACC is used to discount free cash flows because free cash flows are cash flows available to all investors and the WACC is an aggregate of all of the returns for all of the investors. d. Flotation costs account for the issuance costs of a security. e. The book value of short-term debt is a good proxy for its market value in most cases