St. June Inc. is a company that offers delivery service of medical instruments to customers. Recently they decided to raise $30,000,000 in order to build their new storage and distribution center. The medical depot’s target capital structure calls for a debt ratio of 30%. Therefore, $21 million needs to be financed from equity, with $9,000,000 from retained earnings, $4,000,000 from new common stock, and $8,000,000 from preferred stock. The following details the financial data for both the common stock and preferred stock options:

	Common Stock	Preferred Stock
Market Price	$125	$150
Annual Cash Dividend	$14 (EOY 1)	$25
Annual Cash Dividend Growth Rate	6%	-
Issue Price	-	$105
Flotation Costs	14%	10%

Using the following 4 steps, calculate the cost of equity required to finance this new venture:

1. Cost of retained earnings
2. Costs for new common stock 
3. Costs for preferred stock 
4. Cost of equity