Given the following information for Gerken Power Co., find the WACC. Assume the company's tax rate is 35 percent.

Debt: 15,500 6.4 percent coupon bonds outstanding, $1,000 par value, 25 years to maturity, selling for 108 percent of par; the bonds make semiannual payments.

Common Stock: 495,000 shares outstanding, selling for $81 per share; beta is 1.20.

Preferred stock: 20,000 shares of 4.2 percent preferred stock outstanding, currently selling for $92 per share.

Market: 7 percent market risk premium and 3.1 percent risk free rate.