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Excel Activity: Calculating the WMCC Here is the condensed 2021 balance sheet for 5kye Computer Company (in thousands of dollars) i Skye's earrings per share last year were $2.65. The common stock selis for $50.00, last year's cividend (Do) was $1.95, and a flotation sest of 8% would be required to sell new common stock. Secunty anslysts are projecting that the common dividend will grow at an annual rate of 9%. Skye's preferred stock pays a Gividend of $2.75 per share, and its pecerred stock sells for $25.00 per share. The firm's before-tax cost of debt is 9%, and its marginal tax rate is 25%. The firm's currently outstariding 9% aninual coupon rate, lefig: term debt selts at par value. The market risk premium is 6%, the risk-free rate is 7%, and skye's beta is 1.764. The firm's total debt, which is the sum of the conpany's short-term debt and long-term debt, equals $1.225 mition. The data has been collected in the Microsoft Excel fle below. Dewiload the spreadsheet and perform the required analycis to ariswer the questions below. Do not round intermediate caiculations. Round your answers to two decimal places, 9. Caloulate the cost of each capital component, that is, the after-tax cost of debt, the cost of preferred stock, the cost of equity from retained esmings, and the cost of newly isfued common stock. Use the DCF method to find the cost of common equity. After-tax cost of debt: Cost of preferred stock: Cost of retained earnings: Cost of new common stock: b. Now calculate the cost of common equity from retained earnings, uving the CAOM method. C. What is the cost of new common stock based on the CABM? (Hint: Find the defference between re and rs as determined by the DCF method, and add that drferential to the CAPM value to fw) d. If Sikye continues to use the same market-velue capital structure, what is the fimis wMCC assuming that (1) it uses only rethined eamings for equity and (2) if if expends so rapidly that it must issue new common stock? (Hint: Use the market value caphat structure nxcluding current liabilities to determine the weights. Nre, use the single arerage of the required values obtained under the two methods in calculsting WhCc.) b. Now calculate the cost of common equity from retained earnings, using the CAPM method. c. What is the cost of new common stock based on the CAPM? (Hint: Find the difference between re and rs as determined by the DCF method, and add that diferent value for r5 ) d. If Skye continues to use the same market-value capital structure, what is the firm's wACC assuming that (1) it uses only retained earnings for equity and (2) if it e rapidly that it must issue new common stock? (Hint: Use the market value capital structure excluding current liabilities to determine the weights. Also, use the sim the required values obtained under the two methods in calculating WACC.) WACC 1