ABC Ltd is a small company that wants to expand its business by opening a new branch in different cities.To finance the investment, the finance manager advises on an issue of 50, 000 6% preference shares of Sh. 80 par value at an issue price of Sh. 77. What is the cost of this preference shares if the maturity period is 5 years?

ABC Ltd is a small company that wants to expand its business by opening a new branch in different cities.To finance the investment, the finance manager advises on an issue of 50, 000 6% preference shares of Sh. 80 par value at an issue price of Sh. 77. What is the cost of this preference shares if the maturity period is 5 years?

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter18: Initial Public Offerings, Investment Banking, And Capital Formation

Section: Chapter Questions

Problem 5P

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