The Dentite Corporation’s bonds are currently selling to yield new buyers a 12% return on their...
The Dentite Corporation’s bonds are currently selling to yield new buyers a 12% return on their investment. Dentite’s marginal tax rate including both federal and state taxes is 38%. What is the firm’s cost of debt?
Homework Answers
| Firms cost of debt = Yield on bond * (1-Tax Rate) | |
| Firms cost of debt = (12%*(1-0.38)) | |
| Firms cost of debt = 7.44% | |
Add Answer to:
The Dentite Corporation’s bonds are currently selling to yield
new buyers a 12% return on their...
The Holmes Company's currently outstanding bonds have a 10% coupon and a 12% yield to maturity....
The Holmes Company's currently outstanding bonds have a 10% coupon and a 12% yield to maturity. Holmes believes it could issue new bonds at par that would provide a similar yield to maturity. If its marginal tax rate is 25%, what is Holmes' after-tax cost of debt? Round your answer to two decimal places.
Personal After-Tax Yield Corporate bonds issued by Johnson Corporation currently yield 12%. Municipal bonds of equal...
Personal After-Tax Yield Corporate bonds issued by Johnson Corporation currently yield 12%. Municipal bonds of equal risk currently yield 6%. At what tax rate would an investor be indifferent between these two bonds? Round your answer to two decimal places. % Corporate After-Tax Yield The Shrieves Corporation has $15,000 that it plans to invest in marketable securities. It is choosing among AT&T bonds, which yield 9.25%, state of Florida muni bonds, which yield 6% (but are not taxable), and AT&T...
Suppose IBM bonds have a pretax yield of 9%, Treasury bonds have a pretax yield of...
Suppose IBM bonds have a pretax yield of 9%, Treasury bonds have a pretax yield of 7.75%, and Ilinois GO bonds have a pretax yield of 5.50%. Based solely on tax considerations, which of these three bonds would the following investors prefer? a. An investor in Michigan with marginal federal tax rate= 28% and state tax rate 9% b. An investor in New York with marginal federal tax rate 28% and state tax rate 15% c. An investor in Illinois...
The Holmes Company's currently outstanding bonds have a 7% coupon and a 10% yield to maturity....
The Holmes Company's currently outstanding bonds have a 7% coupon and a 10% yield to maturity. Holmes believes it could issue new bonds at par that would provide a similar yield to maturity. If its marginal tax rate is 25%, what is Holmes' after-tax cost of debt? Round your answer to two decimal places.
1. The Holmes Company's currently outstanding bonds have a 7% coupon and a 13% yield to...
1. The Holmes Company's currently outstanding bonds have a 7% coupon and a 13% yield to maturity. Holmes believes it could issue new bonds at par that would provide a similar yield to maturity. If its marginal tax rate is 25%, what is Holmes' after-tax cost of debt? Round your answer to two decimal places.
The Holmes Company's currently outstanding bonds have a 9% coupon and an 11% yield to maturity....
The Holmes Company's currently outstanding bonds have a 9% coupon and an 11% yield to maturity. Holmes believes it could issue new bonds at par that would provide a similar yield to maturity. If its marginal tax rate is 25%, what is Holmes' after-tax cost of debt? Round your answer to two decimal places. %%
The Holmes Company's currently outstanding bonds have a 8% coupon and a 14% yield to maturity....
The Holmes Company's currently outstanding bonds have a 8% coupon and a 14% yield to maturity. Holmes believes it could issue new bonds at par that would provide a similar yield to maturity. If its marginal tax rate is 35%, what is Holmes's after-tax cost of debt? Round your answer to two decimal places.
The Holmes Company's currently outstanding bonds have an 8% coupon and a 14% yield to maturity....
The Holmes Company's currently outstanding bonds have an 8% coupon and a 14% yield to maturity. Holmes believes it could issue new bonds at par that would provide a similar yield to maturity. If its marginal tax rate is 25%, what is Holmes' after-tax cost of debt? Round your answer to tw decimal places
The Holmes Company's currently outstanding bonds have a 10% coupon and a 14% yield to maturity....
The Holmes Company's currently outstanding bonds have a 10% coupon and a 14% yield to maturity. Holmes believes it could issue new bonds at par that would provide a similar yield to maturity. If its marginal tax rate is 25%, what is Holmes' after-tax cost of debt? Round your answer to two decimal places.
The Holmes Company's currently outstanding bonds have a 7% coupon and a 14% yield to maturity....
The Holmes Company's currently outstanding bonds have a 7% coupon and a 14% yield to maturity. Holmes believes it could issue new bonds at par that would provide a similar yield to maturity. If its marginal tax rate is 25%, what is Holmes' after-tax cost of debt? Round your answer to two decimal places. % ?
The Holmes Company's currently outstanding bonds have a 10% coupon and a 12% yield to maturity. Holmes believes it could issue new bonds at par that would provide a similar yield to maturity. If its marginal tax rate is 25%, what is Holmes' after-tax cost of debt? Round your answer to two decimal places.
Personal After-Tax Yield Corporate bonds issued by Johnson Corporation currently yield 12%. Municipal bonds of equal risk currently yield 6%. At what tax rate would an investor be indifferent between these two bonds? Round your answer to two decimal places. % Corporate After-Tax Yield The Shrieves Corporation has $15,000 that it plans to invest in marketable securities. It is choosing among AT&T bonds, which yield 9.25%, state of Florida muni bonds, which yield 6% (but are not taxable), and AT&T...
Suppose IBM bonds have a pretax yield of 9%, Treasury bonds have a pretax yield of 7.75%, and Ilinois GO bonds have a pretax yield of 5.50%. Based solely on tax considerations, which of these three bonds would the following investors prefer? a. An investor in Michigan with marginal federal tax rate= 28% and state tax rate 9% b. An investor in New York with marginal federal tax rate 28% and state tax rate 15% c. An investor in Illinois...
The Holmes Company's currently outstanding bonds have a 7% coupon and a 10% yield to maturity. Holmes believes it could issue new bonds at par that would provide a similar yield to maturity. If its marginal tax rate is 25%, what is Holmes' after-tax cost of debt? Round your answer to two decimal places.
The Holmes Company's currently outstanding bonds have a 9% coupon and an 11% yield to maturity. Holmes believes it could issue new bonds at par that would provide a similar yield to maturity. If its marginal tax rate is 25%, what is Holmes' after-tax cost of debt? Round your answer to two decimal places. %%
The Holmes Company's currently outstanding bonds have an 8% coupon and a 14% yield to maturity. Holmes believes it could issue new bonds at par that would provide a similar yield to maturity. If its marginal tax rate is 25%, what is Holmes' after-tax cost of debt? Round your answer to tw decimal places
Most questions answered within 3 hours.
-
3. (10 pts) You grow a corn crop that yields 150 bushels ac-1,
with the following...
asked 5 minutes ago -
7. The term Six Sigma refers to:
Select one:
a. The control limits established in a...
asked 14 minutes ago -
Wildhorse Company follows the practice of pricing its inventory
at the lower-of-cost-or-market, on an individual-item
basis....
asked 16 minutes ago -
For the following reaction: A(g) + 2 B(g) ⇌ 2 C(g) Calculate the
equilibrium constant K...
asked 17 minutes ago -
Which of the following best describes tidal volume? options:
1.The amount of oxygen in the air...
asked 33 minutes ago -
1. Smaller cost distortions occur when the traditional systems'
single indirect-cost rate and the activity-cost-driver rates:...
asked 41 minutes ago -
Using either a FMECA approach or some other appropriate RCA
tool, identify five risk treatment actions...
asked 41 minutes ago -
If for a test the P-value is between 0.0025 and 0.005, what
conclusion can you draw?...
asked 54 minutes ago -
Using Python. Write a function clean2(aList) that takes a list
of integers aList as argument, and...
asked 59 minutes ago -
Intrapreneurship is defined as the
development of an enterprise culture with an existing (Nandan,
2009). An...
asked 1 hour ago -
QUESTION 1 Tamiflu is a drug used to treat influenza. A study
found that Tamiflu reduced...
asked 1 hour ago -
Which of the following would be less likely to be used to
allocate factory overhead when...
asked 1 hour ago