Timeless Corporation issued preferred stock with a par value of $600. The stock promised to pay an

Question:

Timeless Corporation issued preferred stock with a par value of $600. The stock promised to pay an annual dividend equal to 10.0% of the par value. If the appropriate discount rate for this stock is 14.0%, what is the value of the stock?

1). $667.20

2). $840.00

3). $428.57

4). $351.86

5). $361.71

Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may... Discount Rate
Depending upon the context, the discount rate has two different definitions and usages. First, the discount rate refers to the interest rate charged to the commercial banks and other financial institutions for the loans they take from the Federal... Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their... Par Value
Par value is the face value of a bond. Par value is important for a bond or fixed-income instrument because it determines its maturity value as well as the dollar value of coupon payments. The market price of a bond may be above or below par,...