# Weighted Average Cost of Capital (WACC) Calculator

Please enter your values in the Weighted Average Cost of Capital (WACC) Calculator. Example is included below.

Total Equity (E): Cost of Equity in % (Re): Total Debt (D): Cost of Debt in % (Rd): Corporate Tax Rate in % (Tc):

## How to use the Weighted Average Cost of Capital (WACC) Calculator

Let’s review a simple example in order to demonstrate how to use the WACC Calculator.

Suppose that you’d like to compute the WACC given the following information:

• Total Equity (E) = 20000
• Cost of Equity (Re) = 12%
• Total Debt (D) = 8000
• Cost of Debt (Rd) = 5%
• Corporate Tax Rate (Tc) = 10%

Enter the above values in the WACC calculator, and then click on the Calculate WACC button:

You’ll then get a WACC of 9.86%:

## How to Manually Derive the WACC

You may use the following formula to manually calculate the WACC:

```                   E x Re           D x Rd x (1 - Tc)
WACC =     E + D     +      E + D
```

Where:

• E = Total Equity
• Re = Cost of Equity
• D = Total Debt
• Rd = Cost of Debt
• Tc = Corporate Tax Rate

For example, let’s suppose that your goal is to calculate the WACC, given the following information:

• Total Equity (E) = 20000
• Cost of Equity (Re) = 12%
• Total Debt (D) = 8000
• Cost of Debt (Rd) = 5%
• Corporate Tax Rate (Tc) = 10%

You can then enter the above values in the WACC formula:

```               E x Re      D x Rd x (1 - Tc)         20000 x 0.12          8000 x 0.05 x (1-0.1)WACC = E + D    +        E + D            =    20000+8000      +       20000+8000
```

You’ll get a WACC of 0.0986 or 9.86%..