b) The existing capital structure of XYZ Ltd is given as follows: Sh'000 30,000 10,000 Ordinary share capital par Value (sh 10 each) Reserves 12% Debenture (sh 100 each) 10% Preference share capital Par value (sh 20 each) 15,000 10,000 65,000 Additional information: 1) Ordinary shares of this firm are currently selling at sh.60 each. The 12% Debentures and 10% preference shares are currently selling at sh.80 and sh 30 respectively 2) The most recent dividend paid by this company is sh.2.This is expected to grow at the rate of 10% each year in perpetuity 3) The corporation tax rate applicable is 30% Required: a) The cost of equity capital b)The cost of 12% Debenture capital c) The cost of 10% preferred stock d) Weighted average cost of capital (2 Marks) (2 Marks) (2 Marks) (4 Marks) (Total: 25 Marks)