BUSINESS COLLEGE

​Jensen's Travel Agency has a 7 percent preferred stock outstanding that is currently selling for​ $48 a share. The preferred stock has a​ $100 par value. The market rate of return is 10 percent and the​ firm's tax rate is 34 percent. What is the​ Jensen's cost of preferred​ stock?

Answers

Answer 1
Answer:

Answer:

$20.83

Explanation:

The computation of the cost of preferred stock is shown below:

Cost of preferred stock = (Dividend × par value) ÷ (current selling price) × 100

                                       = (10% × 100) ÷ ($48) × 100

                                       = 10 ÷ 48 × 100

                                       = $20.83

Simply we divide the dividend by the current selling price so that the cost of preferred stock can be computed

All other information which is given is not relevant. Hence, ignored it

Related Questions

KINGBIRD, INC. Income Statement For the Year Ended December 31, 2020 Sales revenue $446,700 Cost of goods sold 202,300 Gross profit 244,400 Expenses (including $16,300 interest and $20,800 income taxes) 70,800 Net income $ 173,600 Additional information: 1. Common stock outstanding January 1, 2020, was 27,200 shares, and 38,600 shares were outstanding at December 31, 2020. 2. The market price of Kingbird stock was $15 in 2020. 3. Cash dividends of $21,700 were paid, $6,500 of which were to preferred stockholders. Compute the following measures for 2020.(a) Earnings per share (b) Price-earnings ratio (c) Payout ratio
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Research shows that projects dedicated to information security policies fail due to eight common perceived missteps. Which of the following is not one of the missteps?
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Additional data: 1. Dividends declared and paid were $25,400. 2. During the year, equipment was sold for $8,700 cash. This equipment cost $18,200 originally and had a book value of $8,700 at the time of sale. 3. All depreciation expense, $15,600, is in the operating expenses. 4. All sales and purchases are on account. Further analysis reveals the following. 1. Accounts payable pertain to merchandise suppliers. 2. All operating expenses except for depreciation were paid in cash.

Answers

Answer:

Preparation of Cash flow statement is below:-

Explanation:

Please find the full information of question

The following are the financial statements of Nosker Company. NOSKER COMPANY Comparative Balance Sheets December 31 Assets 2017 2016 Cash $36,400 $19,600 Accounts receivable 33,000 19,200 Inventory 31,000 20,400 Equipment 59,400 77,600 Accumulated depreciation—equipment (29,800 ) (23,700 ) Total $130,000 $113,100 Liabilities and Stockholders’ Equity Accounts payable $28,700 $ 16,100 Income taxes payable 7,100 8,000 Bonds payable 26,300 32,500 Common stock 18,200 13,600 Retained earnings 49,700 42,900 Total $130,000 $113,100 NOSKER COMPANY Income Statement For the Year Ended December 31, 2017 Sales revenue $242,100 Cost of goods sold 175,500 Gross profit 66,600 Operating expenses 23,900 Income from operations 42,700 Interest expense 2,400 Income before income taxes 40,300 Income tax expense 8,100 Net income $32,200. Prepare a statement of cash flows for Nosker Company using the direct method.

                    Nosker Company

            Statement of cash flow

         For the year ended 31 December, 2017

Cash flow from operating activities

Receipt from customers       $228,300

($242,100 - $13,800)

Less Cash payment

Suppliers                                $173,500

($175,500 + $10,600 - $12,600)

Operating expenses             $8,300

(23,900 - $15,600)

Income tax expenses           $900

($8,100 + $900)

Interest expenses                $35,100

Cash flow from investing activities

Sale of equipment                                       $8,700

Net cash provided by Investing activities  $8,700

Cash flow from financing activities

Issuance of company stock                         $4,600

Less: Land Redemption                                $6,200

Less: Payment of cash dividend                   $25,400

Net cash used by financing activities           $27,000

Net Increase in cash                                         $16,800

Beginning cash                                                 $19,600

Cash at end of period                                       $36,400

Which relationship BEST illustrates a comparison of absolute advantage and comparative advantage? A) A country with an absolute advantage will always have a comparative advantage in producing products. B) A country with a comparative advantage can produce a greater output of a products than a country with an absolute advantage. C) A country with an absolute advantage can produce a product at a lower opportunity cost than a country with a comparative advantage in producing all products. D) A country with a comparative advantage can produce a product at a lower opportunity cost, even if another country has an absolute advantage in the production of all goods.

Answers

Answer:

D) A country with a comparative advantage can produce a product at a lower opportunity cost, even if another country has an absolute advantage in the production of all goods.

Explanation:

Comparative advantage is when a country produces a product at a lower opportunity cost when compared with a country.

An absolute advantage is when a country produces greater quantities of a product when compared with another country.

I hope my answer helps you

Answer: D

Explanation: UsaTestPrep

Many demographers predict that the United States will have zero populationgrowth in the twenty-first century, in contrast to average population growth of about 1percent per year in the twentieth century. Use the Solow model to forecast the effect ofthis slowdown in population growth on the growth of total output and the growth ofoutput per person. Consider the effects both in the steady state and in the transition between steady states

Answers

Answer:

Check the explanation

Explanation:

  • The foremost thing is to first consider steady states. The Sluggish population growth rate swings in the line representing population growth and depreciation to the downward trend.
  • The new stable rate has a superior level of capital per worker thereby having a higher level of output per worker.
  • In Steady state, the entire output develops at rate n, whereas the output rate per worker grows at figure 0. Hence, slower population growth will hamper the figure of total output growth, but the rate of per-worker output growth will be the same.
  • Now reflect on the transition. We know that the constant-state level of output per worker is higher with little population growth. Hence, for the period of the transition to the new steady state, output per worker should grow at a rate faster than 0 for a sometime.

Iron Works International is considering a project that will produce annual cash flows of $38,200, $46,900, $57,600, and $23,100 over the next four years, respectively. What is the internal rate of return if the project has an initial cost of $112,800

Answers

Answer:

18.11%

Explanation:

The internal rate of return is the discount rate that equates the after tax cash flows from an investment to the amount invested.

IRR can be calculated using a financial calculator

Cash flow in year 0 = $-112,800

Cash flow in year 1 = $38,200

Cash flow in year 2 = $46,900

Cash flow in year 3 =$57,600

Cash flow in year 4 =$23,100

IRR = 18.11%

To find the IRR using a financial calacutor:

1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.

2. After inputting all the cash flows, press the IRR button and then press the compute button.

Calculate the current account balance if a small country exports $200 million in goods and services and imports $160 million, it receives $80 million in foreign aid and private charity (net), it pays $15 million to foreign citizens working locally, and its own citizens earn $36 million abroad.

Answers

Answer:

$141 million.

Explanation:

Given: Export= $200 million.

           Import= $160 million.

           Foreign aid received= $80 million

           Payment to foreign citizen= $15 million

           Earning from abroad= $36.

Now, computing current account balance.

Total current account= (X-M)+NI+NT

X- export

M-Import

NI-Net income

NT-Net current transfer.

Net income= (\textrm{ earning of own citizen working abroad - Payment to foreign citizen})

⇒ Net Income= \$ 36-\$ 15= \$ 21\ million

∴ Net Income (NI)= $21 million.

Net Transfer (NT)= $80 million.

Current account= (200-160)+21+80= \$ 141\ million.

∴ Current account balance is $141 million.

A stock currently sells for $65. The dividend yield is 3.5 percent and the dividend growth rate is 4.8 percent. What is the amount of the dividend to be paid in one year

Answers

Answer:

$2.275

Explanation:

Calculation for the amount of the dividend to be paid in one year

Using this formula

D1 =Dividend yield* Stock Amount

Let plug in the formula

D1= .035($65)

D1= $2.275

Therefore the amount of the dividend to be paid in one year will be $2.275
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