The CFO of DMI is trying to determine the company's WACC. Brad, a promising MBA, says that the company should use book value to assign the WACC components' percentages. Angela, a long-time employee and experienced financial analyst, says that the company should use market value to assign the components' percentages. The after-tax cost of debt is at 11.6%, the cost of preferred stock is at 15.08%, and the cost of equity is at 19.96%. Calculate the WACC using both the book value and the market value approaches with the information in the popup window: . Which do you think is better?

Market Information:

	Debt	Preferred Stock	Common Stock
Outstanding	54000	120000	1040000
Market Price	1036.43	94.84	36.08

DMI Balance Sheet :

Current assets	30041	Current liabilities	0
Long-term assets	61959	Long-term liabilities
		Bonds payable	54000
		Owners' equity
		Preferred stock	12000
		Common stock	26000
Total assets	92000	Total liabilities and owners' equity	92000