Exercises: 1. Explain the difference of preference share and ordinary share. (4 marks) 2 Dividends per Share: RM2.50 Current Market Price: RM40 Growth Rate: 4% Calculate the cost of ordinary share. (3 marks) 3.ABC has 50% of debts, 15% of preference share and 35% of ordinary share. In 2022, ABC has issues bond with face value RM1000, coupon rate 4% and 3 years until maturity. The market value of bonds is RM950. The market risk free rate is 3.8%. The ordinary share has beta of 1.3 with required rate of return of 8%. The preference shareholders are receiving an annual dividend of RM0.10. The market value of preference shares is RM2. The company tax is 20%. Calculate a. b. C d. the cost of debts (3 marks) the cost of preference share (3 marks) the cost of ordinary share (3 marks) the WACC of company ABC (3 marks)

Exercises: 1. Explain the difference of preference share and ordinary share. (4 marks) 2. Dividends per Share: RM2.50 Current Market Price: RM40 Growth Rate: 4% Caiculate the cost of ordinary share. ( 3 marks) 3. ABC has 50% of debts, 15% of preference share and 35% of ordinary share. In 2022, ABC has issues bond with face value RM1000, coupon rate 4% and 3 years until maturity. The market value of bonds is RM950. The market risk free rate is 3.8%. The ordinary share has beta of 1.3 with required rate of return of 8%. The preference shareholders are receiving an annual dividend of RM0.10. The market value of preference shares is RM2. The company tax is 20%. Calculate a. the cost of debts (3 marks) b. the cost of preference share ( 3 marks) c. the cost of ordinary share ( 3 marks) d. the WACC of company ABC