ctice questions $...$ Module # $4...$ Cost of Capital

LCULATE COST OF PREFERENCE SHARE $=>$ KP

A company has preferred stock with a current ner price of $$18$ per share. The preferred stack pays an annual dividend of $4\%$ based on a par value of $$100.$ Flotation costs associated with the sale of preferred stock equal $51\mathrm{.}50$ per share The company's marginal tax rate is $40\%.$ Based on the above informption, calculate: $=1.$ Div

A$)$ Costs of preferred stock

B$)$ Costs of new preferred stkck