Capital Value Cost

Component
Debt 60,000 9%
Preferred Stock 50,000 11%
Common Stock 90,000 14%
200,000

60,000
= .30 or 30%
200,000

50,000
= .25 or 25%
200,000

90,000
= .45 or 45%
200,000

Capital Value Weight Cost

Component
Debt 60,000 0.3 9% 2.70%
Preferred Stock 50,000 0.25 11% 2.75%
Common Stock 90,000 0.45 14% 6.30%
1 WACC 11.75%
200,000

Note: The table above shown that the BCD Co. has WACC of 11.75%.