Healthy Snacks, Inc. has a target capital structure of 55 percent common stock, 5 percent preferred stock, and 40 percent debt. Its cost of equity is 14.3 percent, the cost of preferred stock is 8.9 p

The WACC (weighted average cost of capital) for Healthy Snacks, Inc. can be calculated using the formula: WACC = (E/V x Re) + (P/V x Rp) + (D/V x Rd x (1 - T)) Where: E = market value of equity P = market value of preferred stock D = market value of debt V = total market value of the firm (E + P + D) Re = cost of equity Rp = cost of preferred stock Rd = pretax cost of debt T = tax rate Using the information given: E/V = 55% Re = 14.3% P/V = 5% Rp = 8.9% D/V = 40% Rd = 8.1% T = 35% To find the market values of equity, preferred stock, and debt, we need more information. Let's assume that the total market value of the firm is $100 million. Then, we can calculate: E = 0.55 x $100 million = $55 million P = 0.05 x $100 million = $5 million D = 0.40 x $100 million = $40 million V = $55 million + $5 million + $40 million = $100 million Plugging in the numbers, we get: WACC = (0.55 x 0.143) + (0.05 x 0.089) + (0.40 x 0.081 x (1 - 0.35)) WACC = 0.07865 or 7.865% Therefore, the WACC for Healthy Snacks, Inc. is 7.865%. This means that the company needs to earn a return of at least 7.865% on its investments to satisfy its investors and lenders. Any investments that generate a return below this rate could potentially harm the company's value.