Cost of Preferred Stock with Flotation Costs Burnwood Tech plans to issue some $70 par preferred stock with a 8% dividend. A similar stock is selling on the market for $85. Burnwood must pay flotation costs of 7% of the issue price. What is the cost of the preferred stock? Round your answer to two decimal places.

Cost of Preferred Stock with Flotation Costs Burnwood Tech plans to issue some $70 par preferred stock with a 8% dividend. A similar stock is selling on the market for $85. Burnwood must pay flotation costs of 7% of the issue price. What is the cost of the preferred stock? Round your answer to two decimal places.

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter11: Determining The Cost Of Capital

Section: Chapter Questions

Problem 4P

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