Shinedown Company needs to raise $95 million to start a new project . The company will generate no internal equity for the foreseeable future. The company has a target capital structure of 65 percent common stock, 5 percent preferred stock, and 30 percent debt. Flotation costs for issuing new common stock are 7 percent, for new preferred stock are 4 percent, and for new debt are 2 percent.

What is the true initial cost figure the company should use when evaluating its project?

Weighted average Floatation cost 0.0535

Amount of money that needs to be raised = 100.37 million