Given the following information, calculate the weighted average cost of capital for Puppet Corporation. (Round intermediate calculations to 2 decimal places. Round the final answers to 2 decimal places.)

Percent of capital structure: Debt 25% Preferred stock 70 Common equity 5 Additional information: Bond coupon rate 8.5% Bond yield 7.00% Bond flotation cost 2% Dividend, expected common $2.00 Price, common $32.00 Dividend, preferred 6% Flotation cost, preferred 3% Flotation cost, common 4.50% Corporate growth rate 7% Corporate tax rate 35%

a. Calculate the cost of capital assuming use of internally generated funds.

Internal capital cost %

b. Calculate the cost of capital assuming use of externally generated funds.

External capital cost %