If a firm plans to issue new stock, flotation costs finvestment bankers' fees) should not be ignored. There are two approaches to use to account for flotation costs. The first approaci add the sum of fiotation costs for the debt, preferred, and common stock and add them to the initial investment cost. Because the investment cost is increased, the project's expect. of return is reduced so it may not meet the fimis hurdle rate for acceptance of the project. The second approach involves adjusting the cost of common equity as follows: Cost of equity frotn new stock =Te=P2(1T1D1+B The difference between the flotation-adjusted cost of equity and the cost of equity calculated without the flotation adjustment represents the flotation cost adjustment. Quantitative Problem: Barton Industries expects next year's annwal dividend, Di, to be $1.80 and it expects dividends to grow at a constant rate 9=4%. The firm's current comme stock price, Po, is 420.00. If it needs to issue new common stock, the firm will encounter a 4.8% flotation cost, F. What is the flotation cost adjustment that must be added to its cost i retained earnings? Do not round intermediate calculations. Mound your answer to two decimal places: What is the cost of new common equity considering the estimate made from the three estimation methedologies Do not round intermediate calcidations, Hound your answer to two decimal places