Hollister & Hollister (H&H) is considering a new project. The project will require $519,000 for new fixed assets, $221,000 for additional inventory, and $41,000 for additional accounts receivable. Short-term debt (accounts payable/notes payable) is expected to increase by $168,000. The project has a 4-year life. The fixed assets will be depreciated under the three-year MACRS schedule to a zero book value over the life of the project. At the end of the project, the fixed assets can be sold for 20% of their original cost. The net working capital returns to its original level at the end of the project. The project is expected to generate annual sales of $977,000 with costs equal to 60% of revenues. H&Hs corporate tax rate is 34%.

H&H has 32,500 bonds outstanding with a 6.72% coupon rate, paid semi-annually, and 19 years left until maturity. These bonds are currently selling at 103% of par. They also have 2 million common shares outstanding that are currently selling at $11.45/share. H&H recently paid a dividend in the amount of $1.33, and dividends are expected to grow at a constant 3.5%.

What is the cost of equity for H&H? (Report answer in percentage terms and round to 2 decimal places. Do not round intermediate calculations).

What is the pre-tax cost of debt for H&H? (Report answer in percentage terms and round to 2 decimal places. Do not round intermediate calculations).

What is the weighted average cost of capital for H&H? (Report answer in percentage terms and round to 2 decimal places. Do not round intermediate calculations).

What is the combined NCS & NWC for Year 0? (Round answer to zero decimal places. Do not round intermediate calculations).

What is the combined NCS & NWC for the final year of this project? (Round answer to 0 decimal places. Do not round intermediate calculations).

What are the operating cash flows for Year 1 of this project? (Round answer to 2 decimal places. Do not round intermediate calculations).

What is this projects discounted payback period? (Round answer to 1 decimal place. Do not round intermediate calculations).

What is the NPV for this project? (Round answer to 2 decimal places. Do not round intermediate calculations).

What is the IRR for this project? (Report answer in percentage terms and round to 2 decimal places. Do not round intermediate calculations).