Given the following information for Watson Power Co., find the WACC. Assume the company's tax rate is 21 percent. Debt: 20,000 bonds with a 6.8 percent coupon outstanding, $1,000 par value, 20 years to maturity, selling for 95 percent of par; the bonds make semiannual payments.

Common stock: 625,000 shares outstanding, selling for $54 per share; the beta is 1.20.

Preferred 45,000 shares of 2.8 percent preferred stock outstanding, currently stock: selling for $60 per share. Assume par value is $90.

Market: 7 percent market risk premium and 2.2 percent risk-free rate.