The Fontenot Company’s cost of common equity is 18 percent,…
The Fontenot Company’s cost of common equity is 18 percent, its before-tax cost of debt is 13 percent, and its marginal tax rate is 35 percent. Given Fontenot’s market value capital structure below, calculate its WACC. Long-term debt $ 4,000,000 Common equity 16,000,000 Total capital $20,000,000