The firms cost preferred stock financing

Assignment Help Financial Management

Reference no: EM13850767

The Preferred stock of Gator industries sells for $34.55 and pays $2.74 per year in dividends. What is the cost of preferred stock financing? If Gator were to issue 469,000 more preferred shares just like ones it currently has outstanding, it could sell them for $34.55 a share but would incur flotation costs of $2.85 per share. What are the flotation costs for issuing the preferred shares and how should this cost be incorporated into the NPV of the project being financed?

The firm's cost preferred stock financing is ____%

Reference no: EM13850767

Questions Cloud

Principal balance on the loan at end of that first month : A borrower takes out a 30-year mortgage loan for $250,000 with an interest rate of 5% and monthly payments. What portion of the first month’s payment would be applied to amortization of the principal? What would be the principal balance on the loan a..

The recent controversies and proposed solutions. : Workers' compensation programs and the FMLA have proven to be problematic laws for employers. Research these laws to determine the recent controversies and proposed solutions.

What is the firms market value capital structure : Titan Mining Corporation has 9.3 million shares of common stock outstanding and 370,000 6 percent semiannual bonds outstanding, par value $1,000 each. The common stock currently sells for $41 per share and has a beta of 1.15, and the bonds have 20 ye..

Identify a company that might use the chase strategy : Identify a company that might use the chase strategy? Identify a second company that might use the chase strategy? What are some of the challenges associated with using the chase strategy and why

The firms cost preferred stock financing : The Preferred stock of Gator industries sells for $34.55 and pays $2.74 per year in dividends. What is the cost of preferred stock financing? If Gator were to issue 469,000 more preferred shares just like ones it currently has outstanding, it could s..

How is beauty prejudice similar to other forms : How is beauty prejudice similar to other forms of discrimination, such as racism and sexism, both personally and in a workplace? Your response must be at least 200 words in length. You are required to use at least your textbook as source material for..

Reate a new method to calculate the compound value : reate a new method to calculate the compound value of monthly savings

Refuse to renew the loan and bankruptcy will result : The Morris Corporation has $600,000 of debt outstanding, and it pays an interest rate of 8% annually. Morris’s annual sales are $3 million, its average tax rate is 40%, and its net profit margin on sales is 3%. If the company does not maintain a TIE ..

Describe the delphi method and give an example : What is Linear regression forecasting, and give an example. Describe the Delphi method and give an example. What are some Strategies used by supermarkets, airlines, hospitals, banks, and cereal manufacturers to influence demand

User Account

All Pages