Burger Queen can sell preferred stock for $75 with an estimated flotation cost of $5.00. It is anticipated the preferred stock will pay $5 per share in dividends. a. Compute the cost of preferred stock for Burger Queen. b. Do we need to make a tax adjustment for the issuing firm?
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Burger Queen can sell preferred stock for $75 with an estimated flotation cost of $5.00.
It is anticipated the preferred stock will pay $5 per share in dividends.
a. Compute the cost of preferred stock for Burger Queen.
b. Do we need to make a tax adjustment for the issuing firm?
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- chuss Inc. can sell preferred shares for $82 with an estimated flotation cost of $2.00. The preferred stock is anticipated to pay $14 per share in dividends. a. Compute the cost of preferred stock for Schuss Inc. (Round the final answer to 2 decimal places.) Cost of preferred stock % b. Do we need to make a tax adjustment for the issuing firm? multiple choice Yes NoSchuss Inc. can sell preferred shares for $64 with an estimated flotation cost of $3.00. The preferred stock is anticipated to pay $5 per share in dividends. a. Compute the cost of preferred stock for Schuss Inc. (Round the final answer to 2 decimal places.) Cost of preferred stock % b. Do we need to make a tax adjustment for the issuing firm? multiple choice Yes NoAssume that a company borrows at a cost of 0.08. Its tax rate is 0.35. What is the minimum after-tax cost of capital for a certain cash flow if a. 100 percent debt is used? b. 100 percent common stock? (assume that the stockholders will accept 0.08)
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- Blue Corp. is evaluating an extra dividend versus a share repurchase. In either case, $5,500 would be spent. Current earnings are $1.11 per share and the stock currently sells for $42 per share. There are 2,500 shares outstanding. Ignore taxes and other imperfections. If Blue Corp. pays a dividend, what will be the dividend per share? After the dividend is paid, how many shares will be outstanding and what will the price per share be? Enter your answers rounded to 2 DECIMAL PLACES. NOTE: Fractional shares are possible (Ex. 0.49 shares) Dividend 2.2 ☑ Correct response: 2.2±0.01 Shares outstanding = 2500 Correct response: 2,500 Stock price = 39.8 Correct response: 39.8±0.01 Click "Verify" to proceed to the next part of the question. After the $2.2 dividend, the price falls to $39.8 per share. What are earnings per share (EPS) and the price earnings (P/E) ratio? Enter your answers rounded to 2 DECIMAL PLACES. EPS = Number P/E RatioNumber Click "Verify" to proceed to the next part of the…hello, just need help with D and EFlemington Farms is evaluating an extra dividend versus a share repurchase. In either case, $15,000 would be spent. Current earnings are $2.80 per share, and the stock currently sells for $75 per share. There are 2,800 shares outstanding. Ignore taxes and other imperfections. The PE ratio will be ____ if the firm issues the dividend as compared to ____ if the firm does the share repurchase.
