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QUESTION
Greshak Corp. sold 10,000 shares of $150.00 par value preferred stock with a required 10.0% annual dividend at an issue price of $140.00 per share.
Greshak Corp. sold 10,000 shares of $150.00 par value preferred stock with a required 10.0% annual dividend at an issue price of $140.00 per share. Assuming that flotation costs related to the preferred stock is $5.00 per share and the company's marginal tax rate is 40%, what is Greshak's cost of preferred stock capital (rounded)?
Select one:
A. 9.2%B. 10.0%C. 10.2%D. 10.4%9.2%E. 11.1%