• A corporation has 10,000 bonds outstanding with a 6% annual coupon rate, 8 years to maturity, a $1,000 face value, and a $1,100 market price.
• The companys 100,000 shares of preferred stock pay quarterly dividend of .75 cents per share, and sell for $30 per share.
• The companys 500,000 shares of common stock sell for $25 per share and have a beta of 1.5. The risk free rate is 4%, and the market return is 12%.
• Assuming a 21% tax rate
• What is the companys Cost of bonds, cost of equity and WACC?