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Yana Corporation is considering expanding. It plans to finance the expansion by issuing P4 million in preferred stock. The preferred stock has a par value of P50 and a dividend rate of 12 percent. Similar issues of preferred stock are presently yielding 14 percent. QUESTIONS: (a) How much will the company receive for each share? (b) How many shares must be issued?

Yana Corporation is considering expanding. It plans to finance the expansion by issuing P4 million in preferred stock. The preferred stock has a par value of P50 and a dividend rate of 12 percent. Similar issues of preferred stock are presently yielding 14 percent. QUESTIONS: (a) How much will the company receive for each share? (b) How many shares must be issued?

Financial Accounting Intro Concepts Meth/Uses
Financial Accounting Intro Concepts Meth/Uses
14th Edition
ISBN:9781285595047
Author:Weil
Publisher:Weil
Chapter15: Shareholders’ Equity: Capital Contributions And Distributions
Section: Chapter Questions
Problem 2Q
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Yana Corporation is considering expanding. It plans to finance the expansion by issuing P4 million in preferred stock. The preferred stock has a par value of P50 and a dividend rate of 12 percent. Similar issues of preferred stock are presently yielding 14 percent.

QUESTIONS:

(a) How much will the company receive for each share?

(b) How many shares must be issued?  

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