A firm has issued $45 million in long-term bonds that now have 12 years remaining until maturity. The bonds carry an 9% annual coupon and are selling in the market for $1220.74. The firm also has $50 million in market value of common stock. For cost of capital purposes, what portion of the firm is debt financed and what is the after-tax cost of debt, if the tax rate is 35%?

52.35% debt financed; 4.12% after-tax cost of debt

47.65% debt financed; 5.85% after-tax cost of debt

90.00% debt financed; 3.17% after-tax cost of debt

47.37% debt financed; 2.06% after-tax cost of debt