Given the following information, calculate the weighted average cost of capital.
Percent of capital structure:
Preferred stock................................................... 10%
Common equity................................................. 60
Debt..................................................................... 30
Additional information:
Corporate tax rate............................................................... 34%
Dividend, preferred............................................................. $9.00
Dividend, expected common............................................... $3.50
Price, preferred..................................................................... $102.00
Growth rate.......................................................................... 6%
Bond yield............................................................................. 10%
Flotation cost, preferred...................................................... $3.20
Price, common...................................................................... $70.00