Jury Company Wants to Calculate the Component Costs in Its

Essay

Jury Company wants to calculate the component costs in its capital structure.Common stock currently sells for $27,and is expected to pay a dividend of $0.50.Jury's dividend growth rate is 8%,and flotation cost is $1.25.Preferred stock sells for $46,pays a dividend of $4.00,and carries a flotation cost of $1.10.Jury Company bonds yield 9% in the market.Jury is in the 40% tax bracket.
Calculate cost of debt,cost of common stock,cost of new common stock,cost of preferred stock and cost of retained earnings.