Determine capital structure and calculate the WACC:

Tax rate = 50%.

10-year, 10% coupon, semiannual payment noncallable bonds sell for $1,140. Face value = $1000. New bonds will be privately placed with no flotation cost.

10%, $100 par value, quarterly dividend, perpetual preferred stock sells for $118. Face value =$100. Floatation cost (F = 4%)

Common stock sells for $100. D0 = $4.5 and g = 5%.

b = 1.3; rRF = 5%; KM = 9%.

Target capital structure: determine your capital structure but justify why you decided to use the weights.

step by step calculation required.