Exercise 7-14 surland Company expects to have a cash balance of s61.300 on January 1, 2017. These are the relevant monthly budget data for the first two months of 2017 1. Collections from customers: January $86.300 February $161,300. 2. Payments to supplers: January $55.300, February s30,740, February 740, are paid in $1,000 per All other costs are paid as incurred 4. Administrative expenses: January s21,740, February These costs include depreciation of month S. Selling expenses February s20,740. These costs are exclusive of depreciation. They are paid of creditata local bank that enables to berrew up to 2s, ooo The company 6, sales of short-term investments in January are pected to realize $12,740 in ex wants to maintain a minimum monthly cash balance of $35,300. Prepare a cash budget for January and February. SUNLAND COMPANY Cash Budget January February

Calculate the cost of each capital component—in other words, the after-tax cost of debt, the cost of preferred stock (including flotation costs), and the cost of equity (ignoring flotation costs). use both the capm method and the dividend growth approach to find the cost of equity.calculate the cost of new stock using the dividend growth approach.what is the cost of new common stock based on the capm? (hint: find the difference between re and rs as determined by the dividend growth approach and then add that difference to the capm value for rs.)assuming that gao will not issue new equity and will continue to use the same target capital structure, what is the company’s wacc? e. suppose gao is evaluating three projects with the following characteristics.each project has a cost of $1 million. they will all be financed using the target mix of long-term debt, preferred stock, and common equity. the cost of the common equity for each project should be based on the beta estimated for the project. all equity will come from reinvested earnings.equity invested in project a would have a beta of 0.5 and an expected return of 9.0%.equity invested in project b would have a beta of 1.0 and an expected return of 10.0%.equity invested in project c would have a beta of 2.0 and an expected return of 11.0%.analyze the company’s situation, and explain why each project should be accepted or rejected g