Quantitative Problem: Barton Industries expects next year's annual dividend, D1, to be $2.00 and it expects dividends...

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Quantitative Problem: Barton Industries expectsnext year's annual dividend, D₁, to be $2.00 and itexpects dividends to grow at a constant rate g = 4.8%. The firm'scurrent common stock price, P₀, is $21.90. If it needsto issue new common stock, the firm will encounter a 5.4% flotationcost, F. Assume that the cost of equity calculated without theflotation adjustment is 12% and the cost of old common equity is11.5%. What is the flotation cost adjustment that must be added toits cost of retained earnings? Round your answer to 2 decimalplaces. Do not round intermediate calculations.
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What is the cost of new common equity considering the estimatemade from the three estimation methodologies? Round your answer to2 decimal places. Do not round intermediate calculations.
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Requirement a Flotation cost adjustment that must be added to its cost of retained earnings Step1 Calculation of the cost of common stock Dividend in year 1 D1 200 per See Answer

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Quantitative Problem: Barton Industries expectsnext year's annual dividend, D1, to be $2.00 and itexpects dividends to grow at a constant rate g = 4.8%. The firm'scurrent common stock price, P0, is $21.90. If it needsto issue new common stock, the firm will encounter a 5.4% flotationcost, F. Assume that the cost of equity calculated without theflotation adjustment is 12% and the cost of old common equity is11.5%. What is the flotation cost adjustment that must be added toits cost of retained earnings? Round your answer to 2 decimalplaces. Do not round intermediate calculations.%What is the cost of new common equity considering the estimatemade from the three estimation methodologies? Round your answer to2 decimal places. Do not round intermediate calculations.%