McGill Inc. has just issued 10-year bonds that have a face value of $1,000 with a 12% coupon rate paid annually. The bonds sold for $960, but McGill Inc. had to pay $10 flotation costs as well. McGill Inc. has a 30% tax rate. What is the after tax cost of debt?

A) 12.9184%

B) 11.1025%

C) 9.0429%

D) 7.7717%

E) 3.8755%