Flotation costs for new insurances of preferred stock are


A firm's preferred stock pays an annual dividend of $2.50 and the stock sells for $65. Flotation costs for new insurances of preferred stock are 4.5% of the stock value. What is the after tax cost of preferred stock if the firm's tax rate is 30%

Solution Preview :

Prepared by a verified Expert
Finance Basics: Flotation costs for new insurances of preferred stock are
Reference No:- TGS02758484

Now Priced at $10 (50% Discount)

Recommended (92%)

Rated (4.4/5)