Humble Manufacturing is interested in measuring your overall cost of capital

Humble Manufacturing is interested in measuring your overall cost of capital. The company is at the 40% tax level. Ongoing investigation yielded the following data: Debt The company can raise debt by selling 10-year bonds with a par value of $ 1,000 and an interest rate coupon of 8%, on which it will pay annual interest. To sell the issue, an average discount of $ 30 per bond must be granted. In addition, the company must also pay administration costs of $ 20 per bond. Preferred Stock The company can sell preferred stock with an annual dividend of 10% of its value at a par of $ 100 per share. The cost of issuing and selling the preferred shares is expected to be $ 4 per share. Common shares The common shares of the company are currently sold in $ 80 each. The company plans to pay cash dividends of $ 10 per share next year. The company's dividends have grown at an annual rate of 6% and this rate is expected to continue in the future. The shares will incur administrative fees at $ 4 each and costs are expected to be $ 4 per share. b) Calculate the company's weighted average cost of capital using the weights shown in the following table, which are based on proportions of the target capital structure. (Round to the nearest tenth of a percent).