Problem 11-23 Weighted average cost of capital (LO11-1) Given the following information: Percent of capital structure: Preferred stock Common equity (retained earnings) Debt 208 60 20 Additional information: Corporate tax rate 408 Dividend, preferred $ 11.00 Dividend, expected common $ 6.50 Price, preferred $107.00 Growth rate 98 Bond yield 88 Flotation cost, preferred S 7.50 Price, common $ 91.00 Calculate the weighted average cost of capital for Digital Processing Inc. (Do not round Intermediate calculations. Input your answers as a percent rounded to 2 decimal places.) Notice that this problem asks for the weighted costs. These are the unweighted costs times the weights. Like this: (kawal) = weighted cost of debt Answer is complete but not entirely correct. Weighted Cost Debt 0.96 % Preferred stock 2.31 Common equity (retained earnings) 9.68 Weighted average cost of capital 12.95 %