What is the cost of the preferred stock

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LL Incorporated's currently outstanding 8% coupon bonds have a yield to maturity of 12%. LL believes it could issue new bonds at par that would provide a similar yield to maturity. If its marginal tax rate is 30%, what is LL's after-tax cost of debt? Round your answer to two decimal places.

Burn wood Tech plans to issue some $60 par preferred stock with a 7% dividend. A similar stock is selling on the market for $60. Burn wood must pay flotation costs of 6% of the issue price. What is the cost of the preferred stock? Round your answer to two decimal places.

Reference no: EM13723999

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