Messman Manufacturing will issue common stock to the public for $30. The expected dividend and the growth

Question:

Messman Manufacturing will issue to the public for $30. The expected and the growth in dividends are $3.00 per share and 5%, respectively. If the floating cost is 2% of the issue proceeds, then what is the after-tax cost of debt? Disregard the tax shield from the amortization of flotation costs.

Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on... Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...