Weighted Cost of Debt and Equity Capital

Combine debt and equity financing costs with tax rate wey you enter.

Your numbers

WACC

—

Estimate for learning with your assumptions; no live rates, tax rules or investment recommendations. Returns fit dey negative and no get guarantee.

Formula

Use WACC = E×rₑ/(D+E)+D×r_d×(1−τ)/(D+E). E and D na equity and debt market values. rₑ, r_d and τ na equity cost, debt cost and effective tax rate, each as fraction.

Combine debt and equity financing costs with tax rate wey you enter.

Example wey show the calculation

Market value of equity: 600
Market value of debt: 400
Cost of equity financing (%): 10
Cost of debt financing (%): 5
Effective tax rate (%): 25

WACC: 7.5 %

Where e fit work and limits

Estimate for learning with your assumptions; no live rates, tax rules or investment recommendations. Returns fit dey negative and no get guarantee.

We check inputs for missing values and allowed ranges. Result wey pass the finite numeric range no go show. Rounding affect wetin display, while calculation use the model numeric precision.

Check your units and assumptions before you rely on result. Changing label no convert currency or physical unit.

Version of di formula: 811c52c72ae4 · Example don get check: 2026-10-30

Method