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Krisztina

I have been asked to calculate the WACC using the following info: Capital structure: Ordinary shares (fully paid) :1000000, preference shares: (11%) 400000, debentures: (10%) 600000. The ordinary share holders expect a divident of 14% per year. Corporate tax is estimated at 30%.

I did a bit of work on the above challenge, but I'm not sure if I'm on the right track... could someone point out if there are any mistakes? (600,000/2.000,000 * 10% * (130%)) + (400,000/2.000,000 * 11%) + (1.000,000/2.000,000 * 14%) = 19.2% Thank you for any help provided. (...) Read more? Sign up for free
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Mudedla Srinivas Kumar


Calculation of WACC
Though your calculation seems O.K. factoring for Cost of Equity would have made your calculation more refined. which is as follows: Cost of Equity should be : Risk Free return + Beta*Market price.



Antonio Villa Mardon Economist, Peru


WACC
You need to modify the cost of equity as follows:
(...)



bhavik


Response to Calculation of WACC
Though the calculation is correct, you could have (...)



Muhammad Wasim Student (MBA), Pakistan


WACC Calculation
As regards to this calculation, I got a result of (...)



Rishi R Koirala Teacher, Nepal


WACC Calculation
If you calculate the WACC the following way:
600, (...)



Blessing Katuka


Calculation of WACC
Normally the following steps must be done to calcu (...)



Ahid Moghal Teacher, United Kingdom


Calculation of WACC
I calculate using a tableau with 5 columns. That m (...)




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 Calculating WACC  WACC Calculation 


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