ACC414/ACC444 - IN-CLASS TEST Question 1 Given below are capital components and their costs in Chitova Chisamarengu ltd Capital type Equity Preference Debt A Debt B Market Value/ share or bond $ 2.50 $1.50 $95 $102 Cost before tax 14% 9% 8% 7% There 10,000 ordinary shares, 5,000 preference shares and nominal value of debt A is $10,000 and that of debt B is $12,000. Tax rate is 30%. Calculate the after tax WACC Page 1 of 1
