1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
madam [21]
2 years ago
14

Billy's Goat Coats has a preferred share issue outstanding with a current price of $38.89. The firm last paid a dividend on the

issue of $3.50 per share. What is the firm's cost of preferred equity if billy goats coats has a 34% marginal tax rate?
a) 5.94%
b) 8%
c) 9%
d) 10%
Business
1 answer:
blondinia [14]2 years ago
5 0

Answer:

option (c) 9%

Explanation:

Data provided in the question:

current price of outstanding shares = $38.89

Last Dividend paid = $3.50

Marginal tax rate = 34%

Now,

cost of preferred equity = Dividend ÷ Price per share

thus,

cost of preferred equity = $3.50 ÷ $38.89

or

cost of preferred equity = 0.0899

or

cost of preferred equity = 0.0899 × 100%

= 8.99% ≈ 9%

Hence,

The correct answer is option (c) 9%

You might be interested in
Exercise 22-18 Manufacturing cycle time and efficiency LO A4 Oakwood Company produces maple bookcases to customer order. The fol
Zarrin [17]

Answer:

1. The company's manufacturing cycle time  is 17.4 days.

2. The company's manufacturing cycle efficiency is 0.40

Explanation:

1. Manufacturing cycle time

= Process time + inspection time + move time + wait time

= 7 + 0.6 + 4.8 + 5

= 17.4 days

Therefore, The company's manufacturing cycle time  is 17.4 days.

2. manufacturing cycle efficiency

= process time/manufacturing cycle time  

= 7/17.4

= 0.40

Therefore, The company's manufacturing cycle efficiency is 0.40

5 0
3 years ago
The debit side of an account
Vikki [24]
Loan investment account.. can be either side of the account depending on how the accountant set up the system
4 0
3 years ago
Assume that Simple Co. had credit sales of $250,000 and cost of goods sold of $150,000 for the period. It estimates that 1 perce
Dahasolnce [82]

Answer:

A. Debit: Bad Debt Expense 2,500

Credit: Allowance for Doubtful Accounts 2,500

250,000 x .01 = 2,500

B. Debit: Bad Debt Expense 2,750

Credit: Allowance for Doubtful Accounts 2,750

3,000 - 250 = 2,750

8 0
3 years ago
Communicating with people you know or meet to share information or advice about a job defines _____.
Advocard [28]
The answer is career fair.
4 0
2 years ago
Read 2 more answers
If a company's free cash flows are expected to grow at a constant rate of 5% a year, which of the following statements is CORREC
Oliga [24]

Answer:

The correct option is e. The company's value of operations one year from now is expected to be 5% above the current price.

Explanation:

Free cash flow (FCF) refers to the cash that a company generates after taking into consideration cash outflows needed to support operations and maintain the capital assets of the company.

When the free cash flow of a company is expected to grow at a certain constant rate, the implication is that the the value of operations of that company one year from the current period is expected to be higher than the current price.

Based on the explanation above, the correct option is e. The company's value of operations one year from now is expected to be 5% above the current price.

5 0
2 years ago
Other questions:
  • At the completion of the project, the working capital will be released for use elsewhere. Compute the net present value of the p
    13·1 answer
  • The most important factor in helping children to build a strong sense of self-efficacy is to
    10·2 answers
  • Explain why the joint events in a contingency table are mutually exclusive. choose the correct answer below.
    6·1 answer
  • Scientific and technological advancements in a specific industry as well as in society at large are included in which general en
    8·1 answer
  • What is the cheif reason why a person would become a supervisor?
    7·2 answers
  • Which of the following examples demonstrates how successful organizations manage their primary activities?
    12·1 answer
  • KST Mart has large amounts of customer data. To understand customer purchase behavior, the company uses a process that automatic
    14·1 answer
  • 1. The textbook describes how Political, Economic, and Cultural factors can influence international logistics. In terms of compl
    5·1 answer
  • You have just taken out a $ 23 comma 000 car loan with a 4 % ​APR, compounded monthly. The loan is for five years. When you make
    7·1 answer
  • Willamette Manufacturing estimated that its total payroll for the coming year would be $650,000. The workers' compensation insur
    14·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!