Finance

WACC (Weighted Average Cost of Capital) Calculator

Blend the cost of equity and the after-tax cost of debt into a single discount rate. You enter the market values and rates, and it returns WACC along with your capital structure weights.

How to use
  1. Enter the market value of equity (E) and the market value of debt (D).
  2. Add the cost of equity (Re) and the pre-tax cost of debt (Rd).
  3. Set the corporate tax rate to get the after-tax cost of debt.
Estimates for general information, not financial advice. Confirm figures before making money decisions.
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Common questions

Why is debt multiplied by (1 minus tax rate)?

Interest is tax-deductible, so the real cost of debt to the company is lower than the stated rate. The (1 - Tc) factor captures that tax shield.

Should I use book values or market values?

Use market values for both equity and debt. Book values understate equity and give a distorted weight.

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