Given the following table and information, calculate the weighted average cost of capital for FlyByNite Aerospace Company.

Company tax rate is 40%.

Price of current 10 year bonds (7% coupon, mature in 4 years, annual payments) = $1100

Cost to issue preferred stock = $2/share

Cost of preferred stock = $40/share

Preferred stock dividend = $3.20/share

Current cost of equity = 12%

Source	Target Proportion
Common Stock	35%
Preferred Stock	5%
Bonds	60%

Choose one answer.

		6.12%
		8.40%
		7.16%
		6.15%