Given the following information: Percent of capital structure: Preferred stock 20 % Common equity (retained earnings) 35 Debt 45 Additional information: Corporate tax rate 40 % Dividend, preferred $ 5.00 Dividend, expected common $ 2.50 Price, preferred $ 97.00 Growth rate 3 % Bond yield 12 % Flotation cost, preferred $ 9.20 Price, common $ 79.00 Calculate the weighted average cost of capital for Digital Processing Inc. (Do not round intermediate calculations. Input your answers as a percent rounded to 2 decimal places.) Notice that this problem asks for the weighted costs. These are the unweighted costs times the weights. Like this: (kd)(wd) = weighted cost of debt.

Given the following information:

Percent of capital structure:

Preferred stock	20	%
Common equity (retained earnings)	35
Debt	45

Additional information:

Corporate tax rate		40	%
Dividend, preferred	$	5.00
Dividend, expected common	$	2.50
Price, preferred	$	97.00
Growth rate		3	%
Bond yield		12	%
Flotation cost, preferred	$	9.20
Price, common	$	79.00

Calculate the weighted average cost of capital for Digital Processing Inc. (Do not round intermediate calculations. Input your answers as a percent rounded to 2 decimal places.) Notice that this problem asks for the weighted costs. These are the unweighted costs times the weights. Like this: (kd)(wd) = weighted cost of debt.