Peter Johnson, the CFO of Homer Industries, Inc is trying to determine the Weighted Cost of Capital (WACC) based on two different capital structures under consideration to fund a new project. Assume the company's tax rate is 30%.

Component Scenario 1 Scenario 2 Cost of Capital Tax Rate Debt $4,000,000.00 $1,000,000.00 8% 30% Preferred Stock 1,200,000.00 1,500,000.00 10% Common Stock 1,000,000.00 3,700,000.00 13% Total $6,200,000.00 $6,200,000.00

1-a.Complete the table below to determine the WACC for each of the two capital structure scenarios.