WACC- Financial Glossary.

                    WACC- weighted average cost of capital. Whatever the company may be, his long term finance can be circled within equity, preference or any other long term debt. Every individual item as its own specialty, disadvantages and its own cost. The Weighted average cost of capital or WACC shows the combined cost of the three( equity, preference and debt) by taking individual cost and proportion of it into consideration.     

                       In short, overall cost capital is cost of equity* %equity + cost of preference share* %preference shares + (cost of debt* %debt)(1- tax rate).