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?
Calculate Weight for different items in the capital structure
Total capital = Debt + prefererd ...
This solution shows stepwise calculations to determine the weight for different items in the capital structure to find the weight average cost of capital.