Company issues bonds at a price of $925 and a flotation cost of 1%.

The bond has an annual coupon rate of 5% and a maturity of 10 years.

The corporate tax rate is 40%.

Common stock sells at $30 per share and new issues would have a flotation cost of $2.

The last dividend paid was $3 per share and the growth rate of dividends is 6%.

Your firms capital structure is 20% debt, 20% retained earnings, and 60% common stock.

1. Compute the after-tax cost of debt
2. Compute the cost of common stock
3. Compute the cost of retained earnings
4. Compute the Weighted Average Cost of Capital