Yost received 300 nqos (each option gives yost the right to purchase 10 shares of cutter corporation stock for $15 per share) at the time he started working for cutter corporation three years ago. cutter's stock price was $15 per share. yost exercises all of his options when the share price is $26 per share. two years after acquiring the shares, he sold them at $47 per share.

Western electric has 32,000 shares of common stock outstanding at a price per share of $79 and a rate of return of 13.00 percent. the firm has 7,300 shares of 7.80 percent preferred stock outstanding at a price of $95.00 per share. the preferred stock has a par value of $100. the outstanding debt has a total face value of $404,000 and currently sells for 111 percent of face. the yield to maturity on the debt is 8.08 percent. what is the firm's weighted average cost of capital if the tax rate is 39 percent?