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
yaroslaw [1]
3 years ago
14

A company plans to issue new Preferred Stock that pays 6% on the Par Value of $25. Similar preferred stocks are current selling

in the market for Pp = $28. If the firm expects flotation costs of 8% per share, then what is the cost of newly issued preferred stock to the firm? The firms tax rate = 40%.
Business
1 answer:
statuscvo [17]3 years ago
6 0

Answer:

The cost of newly issued preferred stock to the firm is 5.82%

Explanation:

Annual dividend = $25 * 6% = $1.5

Present price = $28

Flotation costs = 8% = 8/100 = 0.08

Cost of new stock = Annual dividend / [Current price(1 - flotation costs)]

Cost of new stock = 1.5 / [ 28(1 - 0.08)]

Cost of new stock = 1.5 / [ 28(0.92)]

Cost of new stock = 1.5 / 25.76

Cost of new stock = 0.0582

Cost of new stock = 5.82% (Approx).

You might be interested in
In the month of November Marigold Corp. wrote checks in the amount of $43300. In December, checks in the amount of $59239 were w
yanalaym [24]

Answer:

$11,977

Explanation:

The difference between the balance of the total checks written and balance of the total checks presented for withdrawal gives the amount outstanding.

As such, amount of outstanding checks at the end of December is the net of the balance of the checks written in November and December and the balance of the checks presented in the same period.

This is

= $43300 + $59239 - $39630 - $50932

= $11,977

4 0
3 years ago
Read 2 more answers
When countries sell off state-owned enterprises and privatize them, it usually results in a(n)A. continuing drain on future natu
babymother [125]

Answer:

C. increase in modernization by new investors.

Explanation:

Privatization is the transfer of ownership of property or business owned by government to a private entity.

Privatization generates capital to be invested in strategic areas and help to reduce the continuing drain on future natural resources. The new private investors causes economic growth by modernizing the acquired property or business from the government.

5 0
3 years ago
Specify which fundamental security design principle applies to the control recommendations?
kipiarov [429]

Specifically the fundamental security design principle applies to the control recommendations of the fundamental security principle.

These principles are developed while keeping in mind the security systems  and to prevent damages and flaws. and unwanted access to the system.They are designed by security agencies and homeland security.

Fundamental security has several principles that are implemented in the software which control certain recommendations  in the design itself, which is easy to update and modify the security patterns and specific tasks. These works both in hardware and software applications.

To learn more about security here,

brainly.com/question/13041590

#SPJ4

3 0
2 years ago
What does the size of the dividend per share of stock depend on?
docker41 [41]
The size of the dividend per share of stock depend on : The corporation's profit

Dividend per share is calculated by : Total dividend / Total shares outstanding,

Which mean that dividend per share will increase if the total dividend increases.

Meanwhile total dividend will increased if the company gains more profit
7 0
3 years ago
Read 2 more answers
In the 1970s japan developed new technologies and achieved high productivity that resulted in
matrenka [14]

New innovation and technology resulted into new business and made Japan a developed countryI believe the closest possible answer to this question is that Japan's prolific inventions were an advantage to the country, in that, they were able to produce business and generate a more efficient system through science and technology.

Thank you for your question. Please don't hesitate to ask in Brainly your queries
8 0
3 years ago
Read 2 more answers
Other questions:
  • Sue-Ellen took Charlie's cell phone without his permission because she wanted it. This is an example of distribution by _____ .
    6·2 answers
  • A __________ is a local operation completely owned by a foreign company.
    15·1 answer
  • In the 21st century, we define justice as:
    14·1 answer
  • Worthington Inc. is considering a project that has the following cash flow data. What is the project's payback period?
    10·1 answer
  • Consider a mutual fund with $300 million in assets at the start of the year and 10 million shares outstanding. The fund invests
    7·1 answer
  • When Ingrid was selling her house, she contacted Gabe, her real estate agent, to help her with the sale. Gabe's services include
    5·1 answer
  • Your credit card company quotes you an interest rate of 21.9 percent based on annual compounding. Interest is billed monthly. Wh
    12·1 answer
  • During 2018, Angel Corporation had 900,000 shares of common stock and 50,000 shares of 6% preferred stock outstanding. The prefe
    10·1 answer
  • what would happen in the market for loanable funds if the government were to increase the tax on interest income the demand for
    10·2 answers
  • Select the correct answer from each drop-down menu. complete the paragraph describing how to initiate an informational interview
    5·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!