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| Name | Weighted Average Cost of Capital (WACC) |
| Video Uploader | Video From WolvesAndFinance |
| Upload Date | This Video Uploaded At 15-05-2016 17:41:56 |
| Video Discription | ZACH DE GREGORIO, CPA www.WolvesAndFinance.com Every business owner should know their weighted average cost of capital and use it in strategic decision making. Each business functions like a machine, with capital flowing in, and profits flowing out. The capital always has a cost that is related to the riskiness of your organization. Every dollar in an organization has a cost. This video discusses how you determine the cost of capital. The equation takes the weighted average of equity (stocks) and bonds. Debt has additional tax benefits which are factored in. If you have other forms of capital, like convertible bonds, you can factor that in as well. Equity will always be more expensive than debt because it is higher risk. Cost of Capital is important when you analyze productivity. Your cost of capital becomes your hurdle rate. Potential projects are assessed based on costs and future cash flows, but the analysis should also include the cost of capital. Neither Zach De Gregorio or Wolves and Finance Inc. shall be liable for any damages related to information in this video. It is recommended you contact a CPA in your area for business advice. [HNEHF9SBpfg] |
| Category | People & Blogs |
| Tags | Finance | Accounting | Corporate Finance | Capital Budgeting | Investment decisions | productivity | hurdle rate | IRR | how do you figure out cost of capital | how do you figure out WACC |
