Cranfield Enterprises has just completed its annual planning and budgeting process and needs to raise $20 million

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Cranfield Enterprises has just completed its annual planning and budgeting process and needs to raise $20 million to finance its capital expenditures for the coming year. The firm earned $18 million last year and will pay out half this amount in dividends. If the firm’s CFO wants to finance new investments using no more than 40 percent debt financing, how much common stock will the firm have to issue to raise the needed $20 million?

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Foundations Of Finance

ISBN: 9780135160619

10th Edition

Authors: Arthur J. Keown, John H. Martin, J. William Petty

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