Compute the weighted average cost of capital (WACC) for internally and externally generated funds:

No of shares/ bonds issued FMV for one Share/bond

Preferred Shares 16500 $74

Common Equity 98000 $23

Debt 2200 $950

Additional info

Corporate tax rate : 39%

Dividend, preferred - $5.90

Dividend, common - $1.30 ( next dividend payment)

Price, preferred - $74

Price , common - $23

Corporate growth rate - 5%

Bond yield (mkt rate) - 11%

Flotation costs. preferred - 5%

Flotation costs, common - $1.93/share

flotation costs, debt - 6%