Explore BrainMass

Explore BrainMass

    Weighted Average Cost of Capital for Metals Corp

    Not what you're looking for? Search our solutions OR ask your own Custom question.

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    Metals Corp. has $2,575,000 of debt, $550,000 of preferred stock, and $18,125,000 of common equity. Metals Corp.'s after-tax cost of debt is 5.25%, preferred stock has a cost of 6.35%, and newly issued common stock has a cost of 14.05%. What is Metals Copr's weighted average cost of capital?

    a. 12.78%
    b. 10.84%
    c. 8.32%
    d. 6.56%

    © BrainMass Inc. brainmass.com March 4, 2021, 8:18 pm ad1c9bdddf
    https://brainmass.com/business/weighted-average-cost-of-capital/weighted-average-cost-of-capital-for-metals-corp-158953

    Solution Preview

    Calculate Weight for different items in the capital structure
    Total capital = Debt + prefererd ...

    Solution Summary

    This solution shows stepwise calculations to determine the weight for different items in the capital structure to find the weight average cost of capital.

    $2.49

    ADVERTISEMENT