Corporate Risk and WACC
Part 1 Calculating Wilson Corporation Weighted Average Cost of Capital (WACC) Long term Debt = 40% Common stock (equity) = 60% Debt yield = 6% Corporate tax = 35% Common stock price = $50 per share Next year’s dividend = $2.50 Annual growth = 4% WACC = Weight of debt (before-tax cost of debt) (1-T) + weight of stock (Cost of stock) Calculate cost […]