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    Cost of preferred stock; cost after flotation costs

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    Taylor Systems has just issued preferred stock. The stock has a 12% annual dividend and a $100 par value and was sold at $97.50 per share. In addition, flotation costs of $2.50 per share must be paid.

    a. Calculate the cost of the preferred stock.
    b. If the firm sells the preferred stock with a 10% annual dividend and nets $90.00 after flotation costs, what is its cost?

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    https://brainmass.com/business/finance/cost-of-preferred-stock-cost-after-flotation-costs-407887

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    Cost of preferred stock
    Taylor Systems has just issued preferred stock. The stock has a 12% annual dividend and a $100 par value ...

    Solution Summary

    Solution helps in computing Cost of preferred stock; cost after flotation costs

    $2.19