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Weighted average cost of capital and pro forma balance sheet

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I have read the assigned chapter in my textbook for my finance class but I am still completely lost. The book doesn't explain in detail and I don't know where to even start. I am going to post the information that is given in the book, just so you know what information is given. I am not posting it in the intention to get someone to do the work for me, sometimes it is necessary to know what information is given in order to explan it better to someone.

Here is the information given and I must calculate the weighted average cost of capital and I have no idea where to even begin:

Debt/Assets After-Tax - Debt Cost of Equity Cost of Capital
0% 8% 12% ?
10 8 12 ?
20 8 12 ?
30 8 13 ?
40 9 14 ?
50 10 15 ?
60 12 16 ?


I also have to complete a pro forma balance sheet. The company's current assets are: Assets $100 Debt $10 Equity $90.

Construct a pro forma balance sheet that indicates the firm’s optimal capital structure. Compare this balance sheet with the firm’s current balance sheet.

Assets $100 Debt $? Equity $?

The final questions are:

What course of action should the firm take? (which I don't fully understand what they are asking for)
As a firm initially substitutes debt for equity financing, what happens to the cost of capital, and why?
If a firm uses too much debt financing, why does the cost of capital rise?