QUESTION $4$

a$)$ Explain the chronology of the dividend payment procedure with examples.

$(12$ Marks$)$

b$)$ Describe FIVE $(5)$ factors that impact the cost of capital.

$(10$ Marks$)$

c$)$ Trim energy maitains a mix of $40$ percent debt, $10$ percent preferred stocks and $50$ percent common stock. The cost of the various types of finance are as follows:

$(3$ Marks$)$

Bonds: $11\mathrm{.}47\%($before tax$)$

Preferred stock: $12\mathrm{.}4\%$

Common Stock: $45\mathrm{.}31\%$

The firm pays corporate tax at a rate of $30\%.$ Compute the firm's WACC.

$($Total: $25$ Marks$)$