To support this client growth, the company plans to hire a number of employees over the coming years. In 2016, they plan to hire a CFO, a designer, and a sales representative. In 2017, they plan to hire a COO, a sales manager, an operations manager, and a customer service manager. In 2018 they plan to hire a second sales manager, a product manager, and 5 sales representatives. In 2019 they plan to hire a third sales manager, a second operations manager, and 5 more sales representatives. In 2020, they plan to hire a third operations manager, a second product manager, and 5 more sales representatives. The planned yearly salaries of these employees are as follows: CFO $200K, designer $65K, product manager $90K, sales manager $100K, COO $200K, customer service manager $80K, operations manager $90K, sales representative $50K. Sales representatives make a 5% commission on each sale they make. In addition to manufacturing and personnel, there are other costs to consider. There is a marketing expense, which is 2% of revenues each year. There is a yearly rent expense, which is $20,000 in 2016. This expense will double each year. There is a utility and supplies expense, which is $3,000 in 2016, and will also double each year. The company is also taxed 27% of revenues each year. When discounting cash flows, please calculate the appropriate WACC. When evaluating the perpetuity value, a 1% growth rate is used.
Please calculate the appropriate WACC for the company.