You gathered the following data for a company: It has $100,000 in bank loans (notes payable)...

 

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You gathered the following data for a company: It has $100,000 in bank loans (notes payable) with 9% interest rate . It has $500,000 in long-term debt with 14% interest rate It has equity worth $1,000,000 with an estimated cost of 25%. What is the weighted average cost of capital (WACC) based on a 30% tax rate? . You gathered the following data for a company: It has $100,000 in bank loans (notes payable) with 9% interest rate . It has $500,000 in long-term debt with 14% interest rate It has equity worth $1,000,000 with an estimated cost of 25%. What is the weighted average cost of capital (WACC) based on a 30% tax rate? .

Answer rating: 100% (QA)

To calculate the WACC we need to determine the proportion of each financing source in the companys c... View the full answer