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Weighted Average Cost Of Capital Calculator

Work out weighted average cost of capital instantly with clear inputs, formula shown and shareable results.

About Weighted Average Cost Of Capital Calculator

WACC blends the cost of each source of capital by its market-value weight, with debt taken after tax because interest is deductible. It is the hurdle rate for projects of average risk and the discount rate in an enterprise valuation.

Formula

WACC

WACC = wₑkₑ + w_d k_d(1 - t)

w
Weight
k
Cost
t
Tax rate

Worked example

With the default values below, Weighted Average Cost Of Capital Calculator returns Weighted Average Cost Of Capital of 11.4625%. Change any input above and every figure here is recalculated in your browser.

Inputs used

Equity Share Of Capitalaccepts 0–100 %
65 %
Cost Of Equityaccepts 0–100 %
14 %
Pre-Tax Cost Of Debtaccepts 0–100 %
9 %
Tax Rateaccepts 0–60 %
25 %

Results

Weighted Average Cost Of Capital
11.4625%
After-Tax Cost Of Debt
6.7500%
Contribution From Equity
9.1000%
Contribution From Debt
2.3625%

Step by step

  1. 1Values used
  2. 2WACC
  3. 3Weighted Average Cost Of Capital= 11.4625
  4. 4After-Tax Cost Of Debt= 6.7500
  5. 5Contribution From Equity= 9.1000
  6. 6Contribution From Debt= 2.3625

Assumptions and limits

  • The result is derived only from the 4 inputs listed above. Anything not among them is not part of the calculation.
  • In particular, this calculator does not take inflation or compounding frequency into account.
  • Figures are rounded for display to 4 decimal places, so totals built from several rounded parts can differ slightly from the unrounded arithmetic.
  • Figures are estimates for planning only. Market returns are not guaranteed, and rates, limits and tax rules change. This is not financial or tax advice — speak to a qualified adviser before acting.
  • This is an estimate for general information and not professional financial, tax or legal advice. See the full disclaimer for the limits that apply to this kind of calculator.

How these calculators are built and tested is described on the Methodology page. If a figure looks wrong, please report it.

Figures are estimates for planning only. Market returns are not guaranteed, and rates, limits and tax rules change. This is not financial or tax advice — speak to a qualified adviser before acting.

Frequently Asked Questions

Should book or market weights be used?

Market weights, since WACC is about the return investors require on today's values.

Does more debt always lower WACC?

Only up to a point. Beyond it, both debt and equity costs rise with financial risk and WACC turns upward.

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Weighted Average Cost Of Capital Calculator | Calcrivo