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Information on Lightning Power Co., is shown below. Assume the company's tax rate is 22 percent Debt: 16,700 5.7 percent coupon bonds outstanding, $1,000 par
Information on Lightning Power Co., is shown below. Assume the company's tax rate is 22 percent Debt: 16,700 5.7 percent coupon bonds outstanding, $1,000 par value, 24 years to maturity, selling for 106.3 percent of par; the bonds make semiannual payments. Common stock: 545,000 shares outstanding, selling for $81.50 per share; beta is 1.10. Preferred stock: 21,000 shares of 4.1 percent preferred stock outstanding, currently selling for $91.20 per share. The par value is $100. Market: 6.3 percent market risk premium and 2.8 percent risk-free rate. What is the company's cost of each form of financing? (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) % Cost of equity Aftertax cost of debt Cost of preferred stock % % Calculate the company's WACC. (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) WACC %
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