Question: Cumming Inc. has a capital structure which is based on 40% debt, 10% preferred stock, and 50% common stock. The after-tax cost of debt is

Cumming Inc. has a capital structure which is based on 40% debt, 10% preferred stock, and 50% common stock. The after-tax cost of debt is 6%, the cost of preferred is 7%, and the cost of common stock is 9%. The company is considering a project that is equally as risky as the overall firm. This project has initial costs of $125,000 and cash inflows of $76,000 a year for two years. What is the projected net present value of this project? $11,398.16$11,403.03$11,275.07

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