Given the following information for King Power Co., find the requested answers. 2 Debt 50,000 bonds outstanding currently trading at $927.87 per bond. The face value is $1,000. The bonds have a 5.2% coupon rate and coupon payments are made semi-annually.The bond has 17 years remaining to maturity 4 Preferred Stock: 150,000 shares that are currently trading for $97.20 per share. The preferred stock is paying an annual dividend of 5 S4.75 per share Common Stock: 900,000 shares outstanding with current market price of $74.17 per share. The firm is expected to announce a $5.20 per share for next year, the growth rate is 3.15%. The market risk premium is 7.00% and the risk free rate is 1.25%. The firm beta is 1.2 Assume a 34% tax rate 1 CAPM: RERrf B(market risk premium) 3 Dividend Growth Model: RED1/P+ g 5 Preferred Stock: Rp- D/Po INSERT EQUATIONSIANSWERS IN HIGHLIGHTED CELLS!! 6 Current Market Value Capital Structure Before-tax Cost of Debt After-tax Cost of Debt Cost of Preferred Stock Cost of Equity CAPM Cost of Equity Dividend Growth Model Cost of Equity average WACC 8 %-Debt 2 Preferred %-Preferred 4