Finance Calculators

WACC Calculator

Calculate a company's weighted average cost of capital (WACC) from its equity and debt mix, cost of each, and tax rate.

Market value of equity

Market value of debt

Cost of equity

Cost of debt (pre-tax)

Corporate tax rate

WACC —

About the WACC Calculator

WACC (weighted average cost of capital) blends the cost of a company's equity and debt financing, weighted by how much of each it uses, into a single rate — often used as the discount rate in valuation and capital-budgeting decisions.

Formula: WACC = (E/V) × Re + (D/V) × Rd × (1 − Tc), where E is equity value, D is debt value, V = E + D, Re is cost of equity, Rd is pre-tax cost of debt, and Tc is the tax rate.

Debt is multiplied by (1 − tax rate) because interest payments are tax-deductible, effectively lowering the true cost of debt financing. A lower WACC generally means a company can fund projects more cheaply.