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Weighted average cost of capital

Rehan (Student)     11 April 2019

 21 points

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Calculate Weighted average cost of capital from the following using a) book value method b) Market Value method 1) Equity Share capital Rs. Rs.3,50,000/- with cost of Equity @ 10% market value is Rs.4,50,000/- 2) 8% Preference shares of Rs.4,00,000/- and its market value is Rs. Rs.4,50,000/- 3) 6% Debt of Rs.6,00,000/- and its market value is Rs.5,60,000/- 4) Retained earnings Rs.1,50,000/- which has no change in the market value . It cost is equal to that of cost of Equity.

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