Manufacturing has target debt-equity ratio

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Reference no: EM131620683

Tulloch Manufacturing has a target debt-equity ratio of 62 which indicates that they have $.62 of debt for each $1.00 of equity. Its cost of equity is 14.3 percent, and its pretax cost of debt is 9.3 percent. If the tax rate is 38 percent, compute the following:

The weight (percent) of debt is:

The weight (percent) of equity is:

The aftertax cost of debt is:

The WACC is:

Reference no: EM131620683

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