Chapter 13 - Review Problems (Graded) Saved Help Save & Exit Submit Check my work Problem 13-15 Calculating Flotation Costs 12.5 points Southern Alliance Company needs to raise $120 million to start a new project and will raise the money by selling new bonds. The company will generate no internal equity for the foreseeable future. The company has a target capital structure of 55 percent common stock, 15 percent preferred stock, and 30 percent debt. Flotation costs for issuing new common stock are 8 percent, for new preferred stock, 5 percent, and for new debt, 3 percent. eBook What is the true initial cost figure the company should use when evaluating its project? (Do not round intermediate calculations and enter your answer in dollars, not millions of References Initial cost