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Cmmon stock is 400,000, long term debt is 200,000,and preferred stock is 200,000 common stock costs 16% long term

debt costs 8% and preferred stock codes 7%? The tax rate is% What is WACC?


I calculated Wts for Investments at

Common: 50%

Preferred Stock 25%

Long Term Debt 25%


Wts for Returns at :

Common 0.0800 or 8%

Preferred 0.175 or 1.75%

Long Term Debt 0.0200 or 2%


I did the table method and got 11.75 percent for WACC but the answer is 12.55 %

I am not sure what to do with the tax rate??

please help

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