You were hired as a consultant to Quigley Company, whose target capital structure is 40% debt, 10% preferred, and 50% common equity. The interest rate on new debt is 6.50%, the yield on the preferred is 6.00%, the cost of retained earnings is 12.25%, and the tax rate is 40%. The firm will not be issuing any new stock. What is Quigley's WACC?© BrainMass Inc. brainmass.com October 10, 2019, 12:49 am ad1c9bdddf
The solution computes Weighted average cost of capital for Quigley.