S14-28 Flotation Costs and NPV [LO3,4] Landman Corpocation (LC) manufactures time series photographic equipment. It is currently at iss target debt-equity ratio of 60 . it's considering bulding a new $73 million manufactiaring facilty. This new plant is expected to generate aftertax cash flows of $9.4 milion in perpetulty. The company raises all equity from outside financing There are theee financing options: 1. A new isswe of common sfock: The fiotntion costs of the new common stock would be 6 percent of the sirsunt raised. The required return on the company's new equity is 13 percent. 2. A new issue of 20 year bonds: The fotaton costs of the new bonds would be 3 percent of the proceeds. If the company istues these new bonds at an annual coupon rate of 7 percent, they will sell at par. 3. Micreased use of accounts payable financing: Because this finencing is part of the company's ongoing doily businest, it has no flotation costs, and the company assigns it a cost that is the same as the overait firm WACC. Management has a target ratio of accounts payable to longiterm debt of 15. (Assume there is no difference between the pretax and aftertax accounts payable cost) What is the NPV of the new plant? Assume the tax rate is 21 percent. (Do not round Intermediate calculations and enter your answer in dollars, not millions, rounded to the nearest whole number, e.g-, 1,234,567.)