You are in charge of estimating you company’s weighted average cost of capital. The company's target capital structure i

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You are in charge of estimating you company’s weighted average
cost of capital. The company's target capital structure is 30%
debt, 20% preferred stock, and 50% common stock. Its current
before-tax cost of debt is 9.5%, and flotation cost for debt can be
ignored. Its preferred stock has a before-tax cost of 12.6%. The
company has just paid a common stock dividend (Do) of $2.79 and
expects to have a constant dividend growth rate of 6%. Its common
stock currently sells for $30 per share. Flotation cost on new
common stock would total 9.3%. Its tax rate is 40%. Compute (a) the
company's cost of newly issued common stock (using the Dividend
Growth Model) and (b) the company’s WACC when the newly issued
common stock is used as the common equity component. Round your
answers to two decimal places of %, but ignore % in your answer,
e.g., xx.xx. (Hint: Measure the cost of common stock first and then
use the WACC formula) Cost of common stock = % ; Company WACC
=