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Archy [21]
2 years ago
12

The cost of perpetual preferred stock is found as the preferred's annual dividend divided by the market price of the preferred s

tock. No adjustment is needed for taxes because preferred dividends, unlike interest on debt, is not deductible by the issuing firm.
A) True
B) False
Business
1 answer:
VikaD [51]2 years ago
5 0
Answer: A


Preferred share dividends are distributions of profits and not interest payments. Thus not tax-deductible.
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