Bosio inc.'s perpetual preferred stock sells for $120.00 per share, and it pays an $8.50 annual dividend. if the company were to sell a new preferred issue, it would incur a flotation cost of 4.00% of the price paid by investors. what is the company's cost of preferred stock for use in calculating the wacc?

Answers

Answer 1

The value of WACC from the given information is about 7.4%.

What is WACC?

WACC is defined as the weighted average cost of capital. It is the rate at which a firm is projected to pay all of its security holders on average to finance its assets.

The firm's cost of capital is frequently referred to as the WACC. It is important to note that the external market, not management, determines this.

The formula of WACC is:

[tex]\text{Weighted Average Cost of Capital (WACC)} = \dfrac{\text{Annual Dividend}}{\text{Sales price of Proffered Stock} - \text{Sales price} \times \text{FC}}[/tex]

According to the given information,

Annual Dividend = $8.50,

Sales price of Proffered Stock =$120.

Flotation Cost(FC) = 4%.

Now, putting the values in the formula of WACC,

[tex]\text{Weighted Average Cost of Capital (WACC)} = \dfrac{\text{Annual Dividend}}{\text{Sales price of Proffered Stock} - \text{Sales price} \times \text{FC}}\\\\\text{Weighted Average Cost of Capital (WACC)} =\dfrac{8.5}{\$120- (\$120 \times 4\%)}\\\\\text{Weighted Average Cost of Capital (WACC)} =0.074(Approx.)[/tex]

Then, the WACC in terms of percentage is 7.4%.

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Related Questions

What are the terms in the exponential expression 5e^3x+1+2

Answers

Answer:

5e ³ x+1+2(solution) terms are 5e5e ³ x,1,1, 2.

Explanation:

A term is a single mathematical expression. It may be a single number (positive or negative), a single variable ( a letter ), several variables multiplied but never added or subtracted. Some terms contain variables with a number in front of them. The number in front of a term is called a coefficient. Does it make more sense?

What is the difference between a primary and secondary group brainly

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primary school is grades k-6 (or k-5 in some cases) and secondary school is grades 7-12 (or 6-12 in some cases).

If there is a 60 chance of rain tomorrow and a 40 chance of wind and rain

Answers

Answer: 67%

Explanation:

I know this

A baseball team plays in a stadium that holds 55000 spectators with ticket prices at 10 the averag 3

Answers

Answer:

A baseball team plays in a stadium that holds 55,000 spectators. With ticket prices at 10, the average attendance had been 27,000. When ticket prices were lowered to10,the average attend ance had been 27,000. When ticket prices were lowered to 8, the average attendance rose to 33,000

Explanation:

In a certain economy when income is $100 consumer spending is $60

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Answer:

In a certain economy, when income is $100, consumer spending is $60. The value of the multiplier for this economy is 4. It follows that, when income is $101, consumer spending isa. $60.25.

"in every free government, the people must give their assent to the laws by which they are governed. this is the true criterion between a free government and an arbitrary one. the former are ruled by the will of the whole, expressed in any manner they may agree upon; the latter by the will of one, or a few. if the people are to give their assent to the laws, by persons chosen and appointed by them, the manner of the choice and the number chosen, must be such, as to possess, be disposed, and consequently qualified to declare the sentiments of the people; for if they do not know, or are not disposed to speak the sentiments of the people, the people do not govern, but the sovereignty is in a few. now, in a large extended country, it is impossible to have a representation, possessing the sentiments, and of integrity, to declare the minds of the people, without having it so numerous and unwieldy, as to be subject in great measure to the inconveniency of a democratic government…." brutus 1 which of the following statements would the author of the passage most likely agree with?

Answers

Answer:

Nations with extended territory cannot fairly represent their citizen in a republican form of government

Explanation:

Δdef ∼ δabc. what is the sequence of transformations that maps δabc to δdef? triangles a b c and d e f on a coordinate plane. a b c has coordinates a 1 comma 1, b 4 comma 4, and c 3 comma 2. d e f has coordinates d negative 1 comma negative 1, e negative 4 comma 2, and f negative 2 comma 1. a reflection across the y-axis and a translation 4 units down a rotation of 180° about the origin and a dilation with center (0, 0) and scale factor 2 a reflection across the y-axis and a translation 2 units down a rotation of 90° about the origin and a translation 2 units down

Answers

Answer:

A

Explanation:

Select the correct answer from each drop-down menu. thaddeus stevens was a powerful . he wanted the former confederate states to be treated as conquered territories. his views were supported by , who worked with stevens to demand equal rights for everyone in the united states.

Answers

Answer:
3. Radical Republican , 2. Andrew Johnson

Explanation:

PLATO

Answer:

the first person is correct

Explanation:

Question 1 with 1 blank para comer una ensalada necesitas… 1 of 1 question 2 with 1 blank para tomar café necesitas… 1 of 1 question 3 with 1 blank para poner la comida en la mesa necesitas… 1 of 1 question 4 with 1 blank para limpiarte la boca después de comer necesitas… 1 of 1 question 5 with 1 blank para cortar (to cut) un bistec necesitas… 1 of 1 question 6 with 1 blank para tomar agua necesitas… 1 of 1 question 7 with 1 blank para tomar sopa necesitas… 1 of 1

Answers

This question aims to complete sentences with nouns in the Spanish language. In this way, the sentences can be rewritten as:

Para comer una ensalada necesitas cubiertos.Para tomar café necesitas una taza.Para poner la comida en la mesa necesitas un plato.Para limpiarte la boca después de comer necesitas una servileta.Para cortar un bistec necesitas cuchullo.Para tomar agua necesitas un vaso.Para tomar sopa necesitas un cuenco.Translation to EnglishTo eat a salad you need cutlery.To drink coffee you need a cup.To put food on the table you need a plate.To wipe your mouth after eating you need a napkin.To cut a steak you need a knife.To drink water you need a glass.To drink soup you need a bowl.

Therefore, this is an activity that helps to establish vocabulary in Spanish, being positive for learning a new language.

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Building sheep pens : darsh and darpan are fencing off a large rectangular area to build some temporary holding pens. to prep the males, females, and kids, they are separated into three smaller and equal-size pens partitioned within the large rectangle. (i) if 384 ft of fencing is available and the maximum area is desired, what will be the dimensions of the larger, outer rectangle? (ii) what will be the dimensions of the smaller holding pens?

Answers

The dimensions of the larger outer rectangle and smaller holding pens are respectively; 96ft x 96ft and 31ft x 96ft

How to maximize Functions?

Let the side lengths of the big rectangle be x and y. Thus the area of the big triangle is; A = xy

If the fencing available is 384 ft, then perimeter is 384 ft. Thus;

2x + 2y = 384

y = (384 - 2x)/2

y = 192 - x

Putting 192 - x for y in A gives us;

A = x(192 - x) = 192x - x²

Completing the square to rearrange the equation of A gives us;

A = 9216 - (x - 96)²

If A is to be a maximum, then;

x - 96 = 0

x = 96 ft

y = 192 - 96 = 96 ft

Since we maximised the area of the bigger rectangle , we have maximised the area of the smaller pens. The dimensions of the smaller holding pens will be;

x' = 96 ft /3 = 31 ft

y' = 96 ft

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This form will be sent to lily by the end of january. she will use this w-2 form to...

Answers

Answer:

obtain employment

Explanation:

did it

W-2s may be delivered by mail in hard copy or made electronically accessible online, either by the employer or through their payroll provider.

What is the use of w-2 form?

If you are qualified, your employer is required to give you a copy of your W-2 each year. Companies must submit this form by the end of January or the beginning of February after the tax year just finished.

If your W-2 is online, you may access it as often as necessary. It's common to ask for automated password recovery if you've forgotten your login information for an online site.

You should speak with your payroll or HR supervisor if you still require assistance with accessing your information online or if you require a fresh paper copy.

Therefore, This form will be sent to lily by the end of January. She will use this w-2 form to obtain employment.

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Which function is continuous at x = 18? f (x) = startfraction (x minus 18) squared over x endfraction f (x) = startfraction x squared minus 17 x minus 18 over x minus 18 endfraction f (x) = tangent (startfraction pi over 36 endfraction x) f (x) = startlayout enlarged left-brace first row x squared, x not-equals 18 second row 36, x = 18 endlayout

Answers

The function that is continuous at x = 18 is:

y = (x - 18)/x

Which function is continuous at x = 18?

We need to see which function has no problems when x = 18.

For example, the first one:

y = (x - 18)/x

When x = 18, we have:

y = (18 - 18)/18 = 0

Then this function is continuous at x = 18.

When, for the second option, we have (x - 18) on the denominator, and then when x = 18 the denominator becomes 0, so that function is not continuous at x = 18.

With that, we conclude that the correct option is the first one.

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Answer:

A on edge

Explanation:

Water in the surface zone of the ocean is for the most part

Answers

I think the north side

An angle is two collinear rays with a common endpoint

Answers

Answer:

Angles are formed by intersection of non- collinear lines, rays and planes.

What is the purpose of the description in this passage from travels with charley? he is showing that america is a beautiful country. he is showing that the country has changed since he has last explored it. he is showing that he has not traveled in a long time. he is showing that america has many unusual sights.

Answers

Answer: B

Explanation:

Answer:

He is showing that the country has changed since he has last explored it.

or b

Explanation:

Now cut the two remote interior angles and paste it on the exterior angle

Answers

An example of remote interior angles on the exterior angle is given in the images attached.

What Is a Remote Interior Angle?

A remote interior angles are known to be those angles that do not have or do not share the same vertex or corner of a triangle with that of an exterior angle.

Note that a remote interior angles are known to be the two angles that are said to be inside the triangle and thus it is often opposite the exterior angle (see image)

See full question below

Using a piece of paper, follow the instructions below.

1. Draw a triangle and name it as ABOD

2. Put point Y on the right side of the triangle.

3. Extend line segment OD to point Y.

4. Identify the exterior angle of the triangle and its two remote interior angles.

5. Now, cut the two remote interior angles and paste it on the exterior angle.

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What does the map tell you about a difference between strategies of the magyars and the vikings? the magyars preferred to invade without settling. the vikings preferred to invade by land. the vikings preferred to settle along the coast. the magyars preferred to invade by land.

Answers

Since the Vikings were pagan, monasteries were popular targets of these raids because of the treasure that could be found inside their walls. Thus, option B is correct.

What the vikings preferred to invade by land

Surprise was a strategy the Vikings used. Before villages or monasteries could prepare to defend themselves, they would strike abruptly.

The purpose of the Viking longboat was to make a smooth beach landing. As a result, the attackers are now free to go forward straight toward their victim.

The Vikings were infamous for setting ambushes and hiding out in wooded areas to wait for advancing troops along established roadways.

Vikings would form a wedge with their best men at the front if they were facing respectable armies in raids.

Therefore, The monastery of Lindisfarne, which is located on a small island off the east coast of England, was attacked by the Vikings early on.

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The muscular system is the system that helps make movement possible, but it also functions on an internal level by helping food move in which two parts of the digestive system?

Answers

Muscle fibers are part of the muscular system that helps in movement and contractibility. The muscle is attached to internal organs and bones.
The two-part of the digestive system where the muscular system operates are stomach and small intestine The functions of the muscular system in digestive organs be explained as:
The smooth muscles are found in the digestive organs like the stomach and intestine.
The muscular muscles contract and relaxes when the food passes through these organs.
The muscles in the digestive system help in pushing the food through the body for absorption and excretory processes. the stomach and intestine have a muscular system.

The water cycle describes how water _____ from the ocean, plants, animals or waste. condenses evaporates

Answers

The water cycle describes how water “evaporates” from the ocean, plants, animals or waste.

Why is freddie watching a surgical procedure? a. because he will be having a similar type of surgery performed on himself b. because he is writing an article about a new procedure that the hospital is using c. because he is writing an article about dr. cole d. because he is working on a science project for school

Answers

Answer:

b.  because he is writing an article about a new procedure that the hospital is using

Explanation:

i just took the test and said the answer was b

John estimates the value of his car over time. the equation for the line of best fit is approximated as y = –2.9x + 17.7, where y represents the value, in thousands of dollars. what values complete the residual table? a = b = c = d =

Answers

The values that complete the residual table a, b, c, d are as follows:

a = 14.8, b = 0.1, c = 9, d = -1.1

What is the equation of a straight-line graph?

A straight-line graph takes the form y = mx + c, in which (m) refers to the gradient, (y) is the intercept, and (c) is the starting value when (x) is zero.

So, from the given information:

y = -2.9x + 17.7 --- (1)

So, to estimate the value of (a) in the table, we have to replace (y = a) and (x = 1) in equation (1).

i.e.

a = -2.9(1) + 17.7a = 14.8

To estimate the value of (b), we need to subtract the given value(12) from the predicted value (11.9)

b = 12 - 11.9b = 0.1

To estimate the value of (c), we need to replace (y = c) and (x = 3) in equation (1).

c = -2.9(3) + 17.7c = -8.7 + 17.7 = 9

To estimate the value of (d), we need to subtract the given value and predicted value.

d = 5 - 6.1d = -1.1

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Answer:

a=14.8

b=0.1

c=9

d= -1.1

Explanation:

:D

Find the relative rate of diffusion for the gases chlorine and ethane

Answers

Answer:

65%

Explanation:

Molar mass of chlorine: 71

Molar mass of ethane: 30

R1 / R2 = root M2 / M1

           = root 30 / 71

           = 0.65

In gas welding, two metals are joined by generating an electric arc between a covered metal electrode and the base metal. is this statement true or false?

Answers

Gas welding is a process that joins the metal with the help of gasoline and oxygen. In gas welding, the metals are joined together by an electric arc.

What is gas welding?

Gas welding is a type of welding process that is used to connect metals. It is a fusion welding that uses heat flame as a source of heat at high temperatures.

In this welding process, the electric arc is created between the metal electrode and the base or the workpiece metal resulting in their fusion.

Therefore, the given statement is true.

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What is the difference of the means of the distributions brainly

Answers

Answer:

Differences between sample means is equal to the difference between population means

Why did george h.w. bush make a promise not to raise taxes during the 1988 election brainly

Answers

The reason why  George HW Bush  made a promise not to raise taxes  was because He wanted to gain an advantage over the Democratic candidate.

What did George HW Bush promise in time of the 1988 election?

He was said to have stated or promised that there will be no new taxes as he wanted to have an advantage over the Democratic candidate.

It was said by American presidential candidate George H. W. Bush at the 1988 Republican National Convention when he wanted to accepted his nomination.

See options below

A.

He wanted to gain an advantage over the Democratic candidate.

B.

He wanted to increase the role of the government in the economy.

C.

He wanted to use the revenues to pull the country out of a recession.

D.

He hoped to avoid promising to reform immigration policies.

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From 1820 to 1850, the largest group of immigrants came to the united states from

Answers

Answer:

1820 and 1850, the largest number of immigrants to the United States came from. Ireland. What made working conditions in factories dangerous during the first.

Explanation:

hope this helps

Which revision makes the instructions more concise? roll the number cube to see which player gets to go first. see who rolls the higher number. take turns rolling one six-sided number cube. the player who rolls the higher number gets a turn.

Answers

The inference is that the revision that makes the instructions more concise is A. roll the number cube to see which player gets to go first.

What is an inference?

An inference is the conclusion that can be deduced based on the information given. It's important for readers to understand a story.

In this case, the inference is that the revision that makes the instructions more concise is to roll the number cube to see which player gets to go first. This is usually done during a game.

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What is mate? a musical instrument a tea that comes from the yerba mate plant a game they play a wild animal

Answers

Answer: B) a tea that comes from the yerba mate plant

Explanation: jus took the quiz

As a healthy substitute for coffee, mate is a tea-like beverage that is most popular in Argentina, Uruguay, Paraguay, and Brazil. The dried leaves of the subtropical Latin American shrub Yerba Mate are used to make this infusion.

What is a beverage?

Beverages are any liquids that can slake a thirst. Drinks can be any form of liquid. Beverage items include all types of drinks, including water, tea, coffee, milk, juice, and others.

Mate is from Latin America. It is like coffee, juice, and any other beverage.

Therefore, it is a beverage.

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Since 1992, how has concern over the increasingly dangerous world described in the passage most affected american political debates?

Answers

The concern about the dangers in the world has caused the debates of immigration into the country, how to protect the nation from foreign enemies.

How terrorism has affected political debates

The terrorism that has been experienced globally around the world has led to debates on how to ensure that the country is safe as well as infrastructures and citizens.

This has led to more security concerns and a major budget on the issues of security in the country.

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The green revolution followed in the mid-1900's and continues today. the green revolution has allowed billions of people to be added to the population in the past few decades through advances in agriculture. how are the industrial and green revolutions connected?

Answers

The industrial revolution provided the work and materials (fertilizers) required for the emergence of the green revolution in the 1950s.

What was the Green revolution?

The Green revolution refers to the emergence of high-yielding crop varieties and high-throughput agriculture techniques in the 1950s.

These high throughput agriculture techniques are associated with the production of huge amounts of fertilizers (industrial revolution).

The Green revolution was so important that high-yielding crops (rice and wheat) contribute to alleviating hunger in the world.

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