Taylor Systems has just issued preferred stock. The stock has an 11% annual dividend and a $75 par value and was sold at $76.50 per share. In addition, flotation costs of $6.75 per share were paid. Calculate the cost of the preferred stock.

Taylor Systems has just issued preferred stock. The stock has an 11% annual dividend and a $75 par value and was sold at $76.50 per share. In addition, flotation costs of $6.75 per share were paid. Calculate the cost of the preferred stock.

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter15: Financial Statement Analysis

Section: Chapter Questions

Problem 54E: Rebert Inc. showed the following balances for last year: Reberts net income for last year was...

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Question

General Accounting question

Taylor Systems has just issued preferred stock.
The stock has an 11% annual dividend and a
$75 par value and was sold at $76.50 per share.
In addition, flotation costs of $6.75 per share
were paid.
Calculate the cost of the preferred stock.

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