# Quantitative Problem: Barton Industries can issue perpetual preferred stock at a price of \$43 per share. The stock would pay a constant annual dividend of \$3.70 per share. If the firm’s marginal tax rate is 40%, what is the company’s cost of preferred stock? Round your answer to 2 decimal places. Answer: % Quantitative Problem: 5 years ago, Barton Industries issued 25-year noncallable, semiannual bonds with a \$1,650 face value and a 10% coupon, semiannual payment (\$82.5 payment every 6 months). The bonds currently sell for \$845.87. If the firm’s marginal tax rate is 40%, what is the firm’s after-tax cost of debt? Round your answer to 2 decimal places. Do not round intermediate calculations. Answe: % Quantitative Problem: 5 years ago, Barton Industries issued 25-year noncallable, semiannual bonds with a \$1,650 face value and a 10% coupon, semiannual payment (\$82.5 payment every 6 months). The bonds currently sell for \$845.87. If the firm’s marginal tax rate is 40%, what is the firm’s after-tax cost of debt? Round your answer to 2 decimal places. Do not round intermediate calculations. Answer: %

1)

what is the company’s require of preferred accumulation

= uniform annual dividend/preferred accumulation price

=3.70/43

=8.60%

the over is acceptance..