a$)$ You have just been hired to compute the cost of capital for debt, preferred stock, and common stock for the Mindflex Corporation. $.$

$$ Cost of common equity: Mindflex$$s common stock paid a $$1\mathrm{.}25$ dividend last year. In addition, Mindflex$$s dividends are growing at a rate of $6\%$ per year and this growth rate is expected to continue into the foreseeable future. The price of the stock is currently $$30.$

$$ Cost of debt: Now let$$s assume that Mindflex$$s bonds are frequently traded. A Mindflex bond has a $$1000$ par value $($face value$)$ and a coupon rate of $13\%$ that is paid semiannually. The bonds are currently selling for $$1,125$ and will mature in $20$ years. Mindflex$$s corporate tax rate is $34\%.$

$$ Cost of preferred stock: Mindflex$$s preferred stock pays a $10\%$ dividend on a $$1\mathrm{.}25$ par value. However, the market price at which the preferred shares could be sold is only $$90.$

The target capital structure is $50\%$ common stock, $15\%$ preferred stock, and $35\%$ debt. What is the Weighted Average Cost of Capital? $(3+3+3+3=12$ marks$)$

b$)$ A company makes widgets in warehouse for $12$ days which takes $17$ days to collect on the sale of each widget and takes $15$ days to pay invoices to company vendors. Calculate the cash conversion cycle? $(4$ marks$)$

c$)$ What is the annualized cost of trade credit in percentage $(\%)?$

Assuming trade credit terms of $2/10$ net $40$ and paying the supplier on the $30$th day? $(4$ marks$)$