The typical costs that businesses incur while financing capital assets are measured by the weighted average cost of capital (WACC).
Long-term liabilities and debts, such as preferred and ordinary stocks and bonds that businesses issue to shareholders and capital investors, can be included in capital costs.
Unlike calculating capital expenses, the WACC takes the weighted average of each source of capital for which a corporation is obligated.
WACC = (E/V * Re) + (D/V * Rd * (1-T))
E = equity market value
R = equity cost
D = debt market value
V = the sum of the equity and debt market values
Rd = debt cost
Tc = the current tax rate for corporations