Belkin is expected to pay an annual dividend of $12.38 one year from now. Dividends are expected to grow by 2.2% every year and the current stock price is $187.4. The company is in the process of issuing new common stock, with flotation costs of 12% of the issue price.

Part 1: What is the cost of new common stock, according to the DCF approach?

Part 2: What is the flotation cost adjustment?