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1-Industrial Supply has a pre-tax cost of debt 7.6%, a cost of equity of 14.3% , and a cost of preferred stock of 8.5%. The
1-Industrial Supply has a pre-tax cost of debt 7.6%, a cost of equity of 14.3% , and a cost of preferred stock of 8.5%. The firm has 220,000 shares of common stock at market price $27 per share. There are 25,000 shares of preferred at $41 per share. Debt is totaled at $ 556,000 and taxes are at 22%. Assuming no tax shield for the preferred stock what is the cost of capital for the firm?
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