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Medical equipment co can issue preferred stock for 80 with

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Reference no: EM13569372

Medical Equipment Co. can issue preferred stock for $80 with an estimated floatation cost of $3. It is anticipated that the preferred stock will pay $6 per share in dividends.

a. Compute the cost of preferred stock for Medical Equipment Co.

b. Do we need to make a tax adjustment for the issuing firm?

Reference no: EM13569372

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