(Solved) : Caughlin Company Needs Raise 55 Million Start New Project Raise Money Selling New Bonds Co Q33249274 . . . .

Caughlin Company needs to raise $55 million to start a newproject and will raise the money by selling new bonds. The companywill generate no internal equity for the foreseeable future. Thecompany has a target capital structure of 55 percent common stock,15 percent preferred stock, and 30 percent debt. Flotation costsfor issuing new common stock are 7 percent, for new preferredstock, 4 percent, and for new debt, 2 percent.

What is the true initial cost figure the company should use whenevaluating its project? (Enter your answer in dollars, notmillions of dollars, e.g., 1,234,567. Do not round intermediatecalculations and round your final answer