How to use this calculator
- Enter equity value, debt value, cost of equity (%), pretax cost of debt (%), assumed deductible tax rate (%).
- Choose a display currency, then select Calculate. Results also update after a brief pause while you edit.
- Read the result with the assumptions below. Export details or save a second scenario to compare your choices.
Formula and method
Assumptions and limitations
The assumed tax shield is not automatic legal deductibility. Total debt plus equity must be positive.
Worked example
With equity value = 600000, debt value = 400000, cost of equity (%) = 10, pretax cost of debt (%) = 5, assumed deductible tax rate (%) = 20, wacc is approximately 7.6%.
What the result means
Use financing values and rates appropriate to the same business and valuation model.
Common questions
How should I interpret wacc?
Use financing values and rates appropriate to the same business and valuation model.
What should I check before using this result?
The assumed tax shield is not automatic legal deductibility. Total debt plus equity must be positive.
Methodology and transparency
Calculation specification reviewed on 2026-10-14. Mathematical implementation is tested against independent reference fixtures. This does not imply review by a licensed financial professional. Read the testing and precision policy.
Background reference: openstax.org — financial method. FinanceMath implements its own calculator.