Problem 11-30 Eaton International Corporation has the following capital structure: Debt (d) Preferred stock (p) Common equity (K) (retained earnings) Total weighted average cost of capital (ka) Cost (aftertax) Weightings 7.1% 25% 8.6 10 14.1 65 Weighted Cost 1.78% 0.86 9.17 100 11.15 a. If the firm has $19.5 million in retained Earnings, at what size capital structure will the firm run out of retained earnings? (Enter the answer in millions.) Capital structure size (X) million b. The 71 percent cost of debt referred to above applied only to the first $14 million of debt. After that the cost of debt will go up. At what size capital structure will there be a change in the cost of debt? (Enter the answer in millions.) Capital structure size (2) million