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A firm has $10 million common equity on the balance sheet. The firm's stock price is...

A firm has $10 million common equity on the balance sheet. The firm's stock price is $25/share and the firm has 1 million shares of stock. The firm has no preferred stock. The firm has total debt at a book value of $30 million but interest rate changes have increased the value of the debt to a current market value of $35 million. To compute WACC of the firm, the weight for equity should be _____ and the weight for debt should be ______.

The answer is 42% and 58%, just don't know how it came to be.

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