Lumber Jack Log Homes Has 30,000 Bonds Outstanding That Are

Lumber Jack Log Homes has 30,000 bonds outstanding that are selling at par. Bonds with similar characteristics are yielding 7.8 %. The company also has 1.5 million shares of common stock outstanding. The stock has a beta of 1.4 and sells for $36 a share. Treasury bills are yielding 4.5 % and the market risk premium is 8.6 %. Jack's tax rate is 34 %. What is Jack's weighted average cost of capital?

A) 12.47 %
B) 12.71 %
C) 13.10 %
D) 13.42 %
E) 13.52 %