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14) Metals Corp. has $2,575,000 of debt, the market value of preferred stock is $1,550,000 and of common stock is $18,125,000

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Answer #1

Total value=(2,575,000+1,550,000+18,125,000)=$22250000

WACC=Respective costs*Respective weight

=(2,575,000/22250000*5.25)+(1,550,000/22250000*6.35)+(18,125,000/22250000*14.05)

=12.5%(Approx).

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