he treasurer of Riley Coal Co. is asked to compute the cost of fixed income securities for her corporation. Even before making the calculations, she assumes the aftertax cost of debt is at least 2 percent less than that for preferred stock. Debt can be issued at a yield of 11.4 percent, and the corporate tax rate is 30 percent. Preferred stock will be priced at $63 and pay a dividend of $5.50. The flotation cost on the preferred stock is $8. a. Compute the aftertax cost of debt.

For the year, uptowne furniture had sales of $818,790, costs of $748,330, and interest paid of $24,450. the depreciation expense was $56,100 and the tax rate was 34 percent. at the beginning of the year, the firm had retained earnings of $172,270 and common stock of $260,000. at the end of the year, retained earnings was $158,713 and common stock was $280,000. any tax losses can be used. what is the amount of the dividends paid for the year? a. $6,466 b. $7,566 c. $5,266 d. $6,898 e. $7,066