What is the free cash flow for years 0-3

Gizmo Inc has outstanding 5 year bonds with a 12% coupon rate, annual payments soiling for $1, 300. Its preferred stock Is selling for $150 and pays a fixed dividend of $12. Gizmo Inc common stock is selling for $200 and has a beta of I. The risk-free rate is 5% and the expected return on the market is 12% The target Capital structure calls for 40% debt, 20% Preferred Stock. 40% Common Equity. Gizmo Inc. is considering the purchase of a new machine for 200,000 It will be depreciated using the MACRS 3-year class life " 133%, 45%, 15% and 7%] and can be used for three years at which time it will Nave a market value of 130.000. Purchase of the new machine will cause an increase in net operating working capital by $10,000. Soles are expected to Increase by $100,000 per year. The new machine will be depreciated using the MACRS 3-year class life. The firm has a marginal tax rate of 40%. What is the before-tax cost of debt? 12.0 % 5.1 % 3.0 %