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The cost of common equity is 16%, before tax cost of debt is 13%, and the marginal tax rate is 40%. The stock sells at
The cost of common equity is 16%, before tax cost of debt is 13%, and the marginal tax rate is 40%. The stock sells at book value. Using the following balance sheet, how can one calculte the WACC? Assets Liabilities and Equity cash $120 Accounts recievable 240 Long-term debt $1,152 Inventories 360 Common equity 1,728 Plant and equipment, net 2,160 Total liabilities and equity 2,880 Total asset 2,880
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