ABC Ltd is a company that produces and sells mats through a network of retail outlets. Management has decided that the company also needs an online presence and wants to raise capital to create a high$-$quality online store and build warehouses for distribution purposes. Currently, the company has R$150$ million in debt and R$200$ million in assets. The company has R$25$ million in retained earnings, which management wishes to use before it issues any new debt. The company would issue bonds after having exhausted its retained earnings, after which it will issue equity $($through a rights issue$)$ up to the required amount. The company requires R$200$ million in capital for its expansion plans, which will be raised as per the guidelines from management. The company can obtain capital as follows:

$$ Up to $5000,$ ten year, R$10000$ par value, $12\%$ annual coupon $($paid at the end of each year$),$ bonds can be issued at R$9000$ per bond.

$$ Up to $2$ million shares can be issued in a renounceable rights issue at a subscription price of R$50$ each $($ignore any issuance or transaction costs$).$

The current market price of the company$$s shares is R$40$ and the company has $625000$ shares in issue and recently paid a dividend of R$7\mathrm{.}30$ per share.

Assume that the company has an unlevered beta of $0,50$; a WACC of $10\%$; is taxed at a rate of $27\%$ and that issuance, and transaction costs are negligible. The risk$-$free rate is $7\%$ and the market risk premium is $5\%.$ The company has a strict target debt to equity ratio of $0\mathrm{.}8($debt ratio of $44,44\%),$ which it plans to revert to soon. Currently, the company has total financing costs $($interest$)$ of R$15$ million per annum. The company has earnings before tax and interest $($EBIT$,$ or and operating profit$)$ of R$25$ million per annum, which is expected to remain stable for the foreseeable future, due to the amount of time it will take to implement the new project successfully.

Required:

a$)$ Determine how much capital the company will need to raise from each source of financing $($if at all$)$

b$)$ Calculate the cost of each source of financing.

c$)$ Determine the weighted average cost of capital $($WACC$)$ for the company.