Sarah Scott borrowed $200,000 from a bank to start a catering business and has agreed to pay the bank $15,000 per year in interest expense.

1. What is the cost of debt for Sarah ?

2. If Sarah raises another $100,000 of equity from her sister Allison, agrees to give her a 25% ownership posiyion in her catering business, and projects annual cash flow before debt to be $50,000, what is Sarah's cost of equity ?

3. What is the weight of debt for Sarah's catering business ?

4. What is the weight of equity for Sarah's catering business ?

5. If Sarah's business falls in the 30% tax bracket, what is her cost of debt after tax?

Show formulas please. Thank you