EBK FUNDAMENTALS OF CORPORATE FINANCE
9th Edition
ISBN: 9781260049237
Author: BREALEY
Publisher: MCGRAW HILL BOOK COMPANY
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Chapter 13, Problem 21QP
Summary Introduction
To compute: The cost of
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Pangbourne Whitchurch has preferred stock outstanding. The stock pays a dividend of $8 per share, and sells for $40. The corporate tax rate is 21%. What is the percentage cost of the preferred stock? Note: Enter your answer as a whole percent.
Pangbourne Whitchurch has preferred stock outstanding. The stock pays a dividend of $9 per share, and sells for $50. The corporate tax rate is 21%. What is the percentage cost of the preferred stock? (Enter your answer as a whole percent.)
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EBK FUNDAMENTALS OF CORPORATE FINANCE
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- A company’s preferred stock currently sells for $95.47 per share and it pays a $4.00 annual dividend. what is the cost of the preferred stock?arrow_forwardCost of preferred stock. Kyle is raising funds for his company by selling preferred stock. The preferred stock has a par value of $79 and a dividend rate of 8.7%. The stock is selling for $61.55 in the market. What is the cost of preferred stock for Kyle? ..... What is the cost of preferred stock for Kyle? % (Round to two decimal places.)arrow_forwardchuss Inc. can sell preferred shares for $82 with an estimated flotation cost of $2.00. The preferred stock is anticipated to pay $14 per share in dividends. a. Compute the cost of preferred stock for Schuss Inc. (Round the final answer to 2 decimal places.) Cost of preferred stock % b. Do we need to make a tax adjustment for the issuing firm? multiple choice Yes Noarrow_forward
- Schuss Inc. can sell preferred shares for $64 with an estimated flotation cost of $3.00. The preferred stock is anticipated to pay $5 per share in dividends. a. Compute the cost of preferred stock for Schuss Inc. (Round the final answer to 2 decimal places.) Cost of preferred stock % b. Do we need to make a tax adjustment for the issuing firm? multiple choice Yes Noarrow_forwardIf Muscat Tiles has preferred stock at $120 per share, with a stated dividend of $8, then what is the cost of preferred stock?arrow_forwardCrane Luxury Liners has preferred shares outstanding that pay an annual dividend equal to $30 per year. If the current price of Crane preferred shares is $176.47, what is the after-tax cost of preferred stock for Crane? - After tax cost of preferred stock?arrow_forward
- Your firm's preferred stock pays a dividend of $5.77 per year. The current price of the preferred stock is $82.19. Your firm's tax rate is 32%. What is your firm's cost of preferred stock? The firm's cost of preferred stock is (Enter the answer in decimal form. Round to two decimal places.arrow_forwardXYZ company has preferred stock that has an annual dividend of $5. If the current market price of a preference share is $30, What is the cost of preference share?arrow_forwardPreferred stock of Ford Motors pays a dividend of $5 each year and trades at a price of $30. What is the cost of preferred stock capital for Ford?arrow_forward
- What is earning per share? What is price- earning patio? what is dividends per share ?What is dividend Yield? When Common stock $10 par value, preferred $5 stock, $25 par. The income was $1250000 and the declared dividends on common stock were$8000000 for the current year. the market price of common stock is $40 per Sharearrow_forwardWhat is the cost of preferred stock if the annual dividend is $8.75, stock price is $12, and the flotation cost is $3? How is the cost of preferred stock impacted if the annual dividend increases to $9? What if the annual dividend decreases to $8.50?arrow_forwardAnthony’s Antiques, Inc. has preferred stock outstanding which pays a dividend of $4 per share a year. The current stock price is $32 per share. What is the cost of preferred stock?arrow_forward
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