You are the financial manager of Concord (Pty) Ltd. Concord's executive committee requested you to present the committee with the company's current market-valued weighted average cost of capital (WACC) as well as its WACC at the agreed target capital structure ratio. Use the following information for these purposes: Extract from the statement of financial position of Concord (Pty) Ltd R 8 000 000 600 000 1 000 000 3 000 000 Ordinary shares issued (1 500 000) Non-distributable reserves Retained earnings Non-convertible 12% preference shares Long-term loan Bank overdraft 2 500 000 300 000 15 400 000 Additional information: 1. The current declared dividend is R3.20 per ordinary share. 2. Shareholders expect a return of 22%. 3. The company projects dividends to grow by 6% per annum. 4. Preference shares are currently trading at 15%. 5. The long-term loan matures ten years from today and carries an interest rate of 14% per annum. The current interest rate for similar loans is 16% per annum. 6. The bank overdraft rate is 20% per annum, but the company does not apply it as part of the capital structure. 7. The relevant tax rate is 30%. 8. The target capital structure is: Equity - 50% Preference shares - 30% Long-term loan -20% Required 1.1. Calculate the weighted average cost of capital (WACC) at market value. 1.2. Apply the target capital structure to calculate the WACC. (35) (1)