Chapter 10 Exercise Problem McGee Computing Service is considering an average-risk project that will cost $92,000 at time zero and is expected to generate annual after-tax cash inflow in the amount of $19,000 for the next 12 years. inst dends is CGee 98 rte is 25%. (Assume yearly coupon payments on the bonds.) The firm has 300,000 shares of common stock outstanding at a price of $40 a share, 10,000 shares of preferred stock outstanding at a price of $80 a share, and 2,000 bonds outstanding at a price of 77.40 percent ofpar. The company's 9% preferred stock has a par value of S100 each. Its currently outstanding bonds have a face value of $1,000, carry an annual coupon rate of 8%, and will mature in 10 years. McGee's most recently paid common dividends are $4 a share and the expected growth in dividends is 6% per year indefinitely. It has no intention to issue additional common equity and instead will rely on retaining earnings for common equity financing. The company's applicable tax Chapter 10 Exercise Problem McGee Computing Service is considering an average-risk project that will cost $92,000 at time zero and is expected to generate annual after-tax cash inflow in the amount of $19,000 for the next 12 years. inst dends is CGee 98 rte is 25%. (Assume yearly coupon payments on the bonds.) The firm has 300,000 shares of common stock outstanding at a price of $40 a share, 10,000 shares of preferred stock outstanding at a price of $80 a share, and 2,000 bonds outstanding at a price of 77.40 percent ofpar. The company's 9% preferred stock has a par value of S100 each. Its currently outstanding bonds have a face value of $1,000, carry an annual coupon rate of 8%, and will mature in 10 years. McGee's most recently paid common dividends are $4 a share and the expected growth in dividends is 6% per year indefinitely. It has no intention to issue additional common equity and instead will rely on retaining earnings for common equity financing. The company's applicable tax