Here is a selected information from the companys balance sheet. The tax rate is 40% and the firm is expected to pay dividend of $2 per year starting next year. The growth rate is 20%. Assume that the bond par value is $1,000. Calculate the market values of the companys debt and equity. Calculate the weights of debt and equity in companys funding structure. Calculate the cost of capital using the WACC formula.

	Book Value	Price	Units Outstanding	Coupon Rate	Maturity
Long Term Debt	$10,000,000	$800	1,000,000	7%	12
Common Stock	$50,000,000	$30	40,000,000