Weighted Average Cost of Capital Calculator - WACC   Excel template (XLSX)
$45.00

Weighted Average Cost of Capital Calculator - WACC (Excel template (XLSX)) Preview Image Weighted Average Cost of Capital Calculator - WACC (Excel template (XLSX)) Preview Image Weighted Average Cost of Capital Calculator - WACC (Excel template (XLSX)) Preview Image Flevy is the marketplace for business best practices.
Loading preview images...
Arrow  

Weighted Average Cost of Capital Calculator - WACC (Excel XLSX)

Excel (XLSX)

$45.00
This Accounting tool was crafted by an Accountant and Financial Modeler with over 10+ years of global experience. He has served 750+ clients, from small family offices to billion-dollar corporations, across a multitude of industries.
Add to Cart
  


Immediate download
Fully editable Excel
Free lifetime updates

VIDEO DEMO

BENEFITS OF DOCUMENT

  1. What-if analysis for WACC and NPV.
  2. In-depth financial simulation tool.

DESCRIPTION

This product (Weighted Average Cost of Capital Calculator - WACC) is an Excel template (XLSX), which you can download immediately upon purchase.

This is a simple finance calculator for one of the more widely used figures in investment analysis. It has implications for valuing any business via DCF Analysis methodology. I'm talking about the Weighted Average Cost of Capital (WACC).

The template walks the user through every component of the WACC calculation for more precise output. I also built in two sensitivity analysis tables to the model as well as a DCF Analysis. Both update as the primary assumptions are adjusted.

Let's try and explain this investment analysis tool plainly:

Think of a company as a big machine that needs money to run smoothly. Just like you need money to buy things, a company needs money to buy things too, like buildings, equipment, and supplies.

Now, where does a company get the money from? It can come from two sources: debt and equity. Debt is when a company borrows money from banks or other lenders, and they have to pay it back with interest. Equity, on the other hand, is money invested in the company by its owners or shareholders.

The Weighted Average Cost of Capital is a way to figure out how expensive it is for a company to get money from these sources. It takes into account both the cost of borrowing money (the interest rate on debt) and the cost of giving ownership to shareholders (the return they expect on their investment).

To calculate the WACC, you need to know the proportion of debt and equity in the company's financing. Think of it like a pizza. If you cut the pizza into slices, the size of each slice represents the proportion of debt or equity. Some companies have more debt (larger debt slice), while others rely more on equity (larger equity slice).

Now, imagine each slice of the pizza has a cost. For debt, it's the interest rate the company has to pay. For equity, it's the return the shareholders expect. The WACC is like taking an average of these costs, but it's not a simple average. It's a weighted average, which means the size of each slice (the proportion of debt or equity) affects the overall result.

So why do we calculate the WACC? Well, it helps companies make important decisions. For example, if a company wants to start a new project or invest in something, they need to know if it's worth it. They compare the potential return of the project with the cost of getting the money to fund it (the WACC). If the potential return is higher than the WACC, it might be a good idea to go ahead with the project. If it's lower, they might reconsider or look for other options.

Note, the file comes with an instructional video and there is a Google Sheet version. If you use the G sheet version, there is no sensitivity tables (not native to that software, requires add-ons) but the primary calculator works as well as the DCF Analysis.

Got a question about the product? Email us at support@flevy.com or ask the author directly by using the "Ask the Author a Question" form. If you cannot view the preview above this document description, go here to view the large preview instead.

Source: Best Practices in Cash Flow Management Excel: Weighted Average Cost of Capital Calculator - WACC Excel (XLSX) Spreadsheet, Jason Varner | SmartHelping


$45.00
This Accounting tool was crafted by an Accountant and Financial Modeler with over 10+ years of global experience. He has served 750+ clients, from small family offices to billion-dollar corporations, across a multitude of industries.
Add to Cart
  

ABOUT THE AUTHOR

Additional documents from author: 175

I graduated in 2011 with a Bachelors degree in Accounting. From there, I worked at a few small businesses doing financial reporting and some bookkeeping. After a few years of that, I started doing freelance financial consulting work on Elance and Upwork.

After over 400 jobs completed with a 100% success rate, I now run my own modeling/consulting practice and continue to build new financial models every few weeks. [read more]

Ask the Author a Question

Must be logged in

Did you know?
The average daily rate of a McKinsey consultant is $6,625 (not including expenses). The average price of a Flevy document is $65.
Bundle and save! You can save up to % with bundles!

View bundle(s)




Trusted by over 10,000+ Client Organizations
Since 2012, we have provided best practices to over 10,000 businesses and organizations of all sizes, from startups and small businesses to the Fortune 100, in over 130 countries.
AT&T GE Cisco Intel IBM Coke Dell Toyota HP Nike Samsung Microsoft Astrazeneca JP Morgan KPMG Walgreens Walmart 3M Kaiser Oracle SAP Google E&Y Volvo Bosch Merck Fedex Shell Amgen Eli Lilly Roche AIG Abbott Amazon PwC T-Mobile Broadcom Bayer Pearson Titleist ConEd Pfizer NTT Data Schwab




Read Customer Testimonials




Save with Bundles

This document is available as part of the following discounted bundle(s):


Your Recently Viewed Documents


Customers Also Like These Documents

Related Management Topics


Cash Flow Management Working Capital Management Business Case Development Business Resilience Cash Conversion Cycle

Download our FREE Strategy & Transformation Framework Templates

Download our free compilation of 50+ Strategy & Transformation slides and templates. Frameworks include McKinsey 7-S Strategy Model, Balanced Scorecard, Disruptive Innovation, BCG Experience Curve, and many more.