This account appears on the Financial Ratios Report and displays the Cost of Capital (v5000) amount.
Cost of Capital (Kw) (v5000.00)
Cost of Capital (v5000.00) is the weighted average costs of debt and equity.
Enter the rate as a percentage. Using one rate for all periods is recommended.
Cost of Capital (Kw) forms the basis of the Discount Factor (Kw) (v5000.01) that is multiplied by future cash flows to calculate their present value.
Strategic Finance distinguishes between the Cost of Capital (v5000) during the forecast period and in the residual period, Long-Term Cost of Capital (%) (v5005). It is generally recommended that Cost of Capital (Kw) (v5000.00) and Long-Term Cost of Capital (%) (v5005) share input.