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YTM ON BONDS7.5%Yesterdays common stock dividend $2.00Coupon rate on bonds6.5%Expected common stock growth rate4%Years to maturity on bonds 22Common stock price$28.30Tax rate 24%Debt weight42%Preferred stock

YTM ON BONDS7.5%Yesterdays common stock dividend $2.00Coupon rate on bonds6.5%Expected common stock growth rate4%Years to maturity on bonds 22Common stock price$28.30Tax rate 24%Debt weight42%Preferred stock dividend $2.50Preferred stock weight 12%Preferred stock price$26.80Common stock weight46%

You have the information above Kostko. Determine the firms WACC.

What is Kostkos after tax cost of debt?

What is Kostkos cost of preferred stock?

What is Kostkos cost of common stock?

What is Kostkos WACC?

Source WeightCostWeight x CostDebt Preferred stock Common stock Total

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