It depends on the purpose for which you are calculating WACC. The proper calculation of WACC implies market values of debt and equity. If this is being calculated for investment appraisal and the company intends to move quickly to a target ratio, then use the target. If you are looking back over performance to calculate EVA, then the target rate is not relevant. You need to deduct the WACC calculated using the actual debt:equity ratio as that cost of the capital that has to be covered to see if there is any value added.