Question: Problem 1 The CCC Corporation made available the following data as requested: Total interest payments on bonds payableP60,000 Preferred stock dividends20,000 Common Stock dividends24,000 Annual

Problem 1

The CCC Corporation made available the following data as requested:

Total interest payments on bonds payableP60,000

Preferred stock dividends20,000

Common Stock dividends24,000

Annual growth on common stock dividend2%

Market Values of:

Bonds PayableP400,000

Common Stock300,000

Preferred Stock200,000\

Retained Earnings100,000

Company Tax rate30%

Stockholders' Marginal Tax Rate70%

REQUIRED:Calculate the firm's Costof Capital

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