Novak lourist corporations preterred shares are at $12 per share, paying annual dividends at a 7% rate,
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Question:
Novak lourist corporations preterred shares are at $12 per share, paying annual dividends at a 7% rate, and have flotation costs or 2%. In addition, the company issued $100 par value 5-year bonds paying o annual coupons and a before-tax cost of issuing of 2%. Novak Tourist Corporation's tax rate is 30%. Calculate the company's after-tax cost of preferred shares and cost of debt. (Round answers to 2 decimal places, e.g., 15.75.)
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