Check my work Problem 11-25 Changes in cost and weighted average cost of capital (LO11-1] A-Rod Manufacturing Company is trying to calculate its cost of capital for use in making a capital budgeting decision Mr Jeter, the vice-president of finance, has given you the following information and has asked you to compute the weighted average cost of capital The company currently has outstanding a bond with a 113 percent coupon rate and another bond with an 8.9 percent rate. The fim has been informed by its investment banker that bonds of equal risk and credit rating are now selling to yield 122 percent. The common stock has a price of $67 and an expected dividend (0) of $187 per share. The historcal growth pattern (ol for dividends in as follows $ 1.42 1.56 1.71 1.07 The preferred stock is selling at $87 per share and pays a dividend of 58 30 per share. The corporate tax rate is 30 percent The flotation cost is 30 percent of the selling price for preferred stock. The optimum capital structure for the fem is 30 percent de 10 percent preferred stock, and 60 percent common equity in the form of retained camnings, o. Compute the average historical growth rate (Do not round intermediate calculations, Round your answer to the nearest whole percent and use this value os g.Input your answer as a whole percent.) Growth rate ES Check my b. Compute the cost of capital for the individual components in the capital structure. (Use the rounded whole percent computed in part a for g. Do not round any other intermediate calculations. Input your answers as a percent rounded to 2 decimal places.) Weighted Cost Debt Preferred stock Common equity c. Calculate the weighted cost of each source of capital and the weighted average cost of capital. (Do not round intermediate calculations. Input your answers as a percent rounded to 2 decimal places.) Weighted Cost Debt Preferred stock Common equity Weighted average cost of capital 000