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    Cost of preferred stock including flotation costs

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    On the New York Stock Exchange, the preferred stock of Ward Butler Inc., which has a stated dividend of 8% and a par value of $50, is trading for $49.00. The company will sell 1 million new shares at the going market rate and will have to pay 5% in flotation costs. What is the cost of the preferred stock, including flotation?

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    Solution Summary

    This provides the steps to calculate the Cost of preferred stock including flotation costs

    $2.19