The capital structure for the CR Corporation includes bonds valued at $5,500 and common stock valued at $11,000.If CR has an after-tax cost of debt of 6%,and a cost of common stock of 16%,what is its WACC?

Name: The capital structure for the CR Corporation includes bonds valued at $5,500 and common stock valued at $11,000.If CR has an after-tax cost of debt of 6%,and a cost of common stock of 16%,what is its WACC?
Brand: Quizplus
Rating: 4.8 (48 reviews)

Question

Quizplus · Accepted Answer

WACC = [($5,500 / $16,500) × 6%] + [($11,000 / $16,500) × 16%] = 12.67%

The Capital Structure for the CR Corporation Includes Bonds Valued