Mason PLC is a successful company which is embarking on an expansionary phase. It wishes to undertake a major new project which require an investment of 3 million. Mason will evaluate this project using its weighted average cost of capital. The capital structure of Mason as per its financial statements as at 31st December 2022 is as follows: The ordinary shares are currently trading at 3.20 Cum-div. A dividend of 0.18 is due to be paid. Dividends have grown over the past number of years at an annual rate of 5% and Mason expects this level of growth to continue into the future. The preference shares are currently trading at 0.94 (cum-div) per share. The dividends are paid yearly and a payment is due shortly. The debentures are redeemable at par and the current market value is 96.50 ex-interest per 100 nominal value. All interest payments have been paid. Debentures are redeemable in five year's time. Mason pays corporation tax at the rate of 15%. Required A) Calculate the weighted average cost of capital for Mason (15 marks) B) Mason is considering financing the 3m expansion with a bank loan at a fixed rate of 10.2% before tax. Calculate the impact this will have on Mason weighted average cost of capital. You can assume that the cost of the current sources of finance remain unchanged ( 5 Marks) C) Discuss whether or not it is appropriate for Mason to use the weighted average cost of capital (as calculated in A above) as a discount factor to evaluate the new project ( 5 marks) Mason PLC is a successful company which is embarking on an expansionary phase. It wishes to undertake a major new project which require an investment of 3 million. Mason will evaluate this project using its weighted average cost of capital. The capital structure of Mason as per its financial statements as at 31st December 2022 is as follows: The ordinary shares are currently trading at 3.20 Cum-div. A dividend of 0.18 is due to be paid. Dividends have grown over the past number of years at an annual rate of 5% and Mason expects this level of growth to continue into the future. The preference shares are currently trading at 0.94 (cum-div) per share. The dividends are paid yearly and a payment is due shortly. The debentures are redeemable at par and the current market value is 96.50 ex-interest per 100 nominal value. All interest payments have been paid. Debentures are redeemable in five year's time. Mason pays corporation tax at the rate of 15%. Required A) Calculate the weighted average cost of capital for Mason (15 marks) B) Mason is considering financing the 3m expansion with a bank loan at a fixed rate of 10.2% before tax. Calculate the impact this will have on Mason weighted average cost of capital. You can assume that the cost of the current sources of finance remain unchanged ( 5 Marks) C) Discuss whether or not it is appropriate for Mason to use the weighted average cost of capital (as calculated in A above) as a discount factor to evaluate the new project ( 5 marks)