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HW Score: 0%, 0 of 1 of 1 (0 complete) Score: 0 of 1 pt P9-19 (similar to) Question Help Calculation of individual costs and WACC Lang Enterprise is interested in measuring its overall cost of capital, Current investigation has gathered the following data. The firm is in the 2016 tax bracket Debt The firm can raise debt by soling $1.000 par value, 4% upon rest rate 12-year bonds on which annual interest payments will be made to sell these an average discount of $30 per bond would have to be given Thermiso must pay fotation costs of 35 per bond Preferred stock The firm can sell 8% preferred stock at its $110.per-share par value. The cost of issuing and soling the preferred stock is expected to be $7 per share Preferred stock can be sold under these forms. Common stock The firm's common stock is currently selling for $70 per share. The firm expects to pay cash dividends of S7 por share next year. The rm's dividends have boon growing at an annual role of and this growth is expected to continue into the future. The stock must be underpriced by S6 per share, and folation costs are expected to amount to 5 por share. The firm can now common stock under those forms Retained earnings When measuring this cost the firm does not concern ist with the lax bracket or brokerage foes of owners. I expects to have available $130,000 of retained earnings in the coming year; once these rotaned oamings are exhausted, the firm wil us now common stock as the form of common stock equily financing a. Calculate the after-tax cost of debt a. The after-tax cost of debt using the approximation formula is (Round to two decimal places) a. Calculate the after-tax cost of debt. b. Calculate the cost of preferred stock. c. Calculate the cost of common stock. d. Calculate the firm's weighted average cost of capital using the capital structure weights shown in the following table, (Round answert 0 Data Table mal places.) (Click on the icon located on the top-right corner of the data table below in order to copy its contents into a spreadsheet.) Source of capital Long-term debt Preferred stock Common stock equity Total Weight 25% 20 55 Clear All 100%

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