Given the following information for Lightning Power Co., find the WACC. Assume the companys tax rate is 35 percent. Debt: 8,000 6.5 percent coupon bonds outstanding. $1,000 par value, 25 years to maturity, selling for 106 percent of par; the bonds make semiannual payments. Common stock: 310,000 shares outstanding, selling for $57 per share: the beta is 1.05. Preferred Stock: 15,000 shares of 4 percent preferred stock outstanding, currently selling for 72 per share. Market: 7 percent market risk premium and 4.5 percent risk-free rate.

WACC = Kd x Pd + Kpfd x Kpfd + Ke x Pe

The market proportions, costs and weighted costs are in decimals to 4 places.

Source	Market Value	Market Portions	Costs	Weighted Costs
Debt	$8,480,000			.0122
Preferred	1,080,000
Equity	17,670,000	.6489
Total	27,230,000		WACC=