Problem 2: Page 446 P9-9. Cost of preferred stock: rp=Dp,Np(16 points) Similar to P910 A. Calculate the cost of the preferred stock . If the firm sell the preferred stock with a 10% annual dividend and nets $90.00 after flotation costs, what is its cost? Problem 3: Payback period (12 points) Similar to P10-1 Construction Co. is considering a capital expenditure that requires an initial investment of $38,450 and returns after-tax cash inflows of $5,800 per year for 6 years. The firm has a maximum acceptable payback period of 5 years. a. Determine the payback period for this project. b. Should the company accept or reject the project? Why? Cost of preferred stock Mavis Taylor Corporation has just issued preferred stock. The stock has a 6% annual dividend and a $100 par value, and was sold at $98.5 per share. Flotation costs were an additional $3 per share. Problem 5: Book value and recaputured depreciation (15 points) Similar to E11-4 Jenson Inc. invested in purchasing a new inventory system which cost $232,000 installed. Since that purchase depreciation has totaled $134,000. a. What is the current book value of the system? Installed cost - depreciation = b. If the system is sold for $146,000, how much recaptured depreciation would result? Sales price - current book value =