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The Coetzer Company can issue $1000 par value bonds with a 15-year maturity and 12.00 percent...
The Coetzer Company can issue $1000 par value bonds with a 15-year maturity and 12.00 percent annual coupon for $1200.00. The tax rate is 40 percent. Coetzer's after-tax cost of debt is: Your Answer: Answer units
Costly Corporation plans a new issue of bonds with a par value of $1000, a maturity of 24 years, and an annual coupon rate of 12.0%. Flotation costs associated with a new debt issue would equal 6.0% of the market value of the bonds. Currently, the appropriate discount rate for bonds of firms similar to Costly is 13.0%. The firm's marginal tax rate is 30%. What will the firm's true cost of debt be for this new bond issue?
Suppose Micron technology sold today an issue of bonds with a 15-year maturity, a $1000 par value, a 10 percent annual coupon, and semi-annual interest payments. The bonds are callable six years after they are issued. If the bonds were called, Micron Technology would pay a call premium of 10 percent and six months extra interest. a) Two years after the bonds were issued, the going rate of interest on bonds such as these fell to 8 percent. At what...
Sunland has determined that it could issue $1000 face value bonds with an 10 percent coupon paid semiannually and a 5-year maturity at $939.63 per bond. If Sunland’s marginal tax rate is 40 percent, its after-tax cost of debt is closest to: A_6.6 percent.,B_7.0 percent., C_7.3 percent., D_6.7 percent.
"What is the WACC for the following company? Debt: 15,000 bonds with a par value of $1,000 and a quoted price of 113.25. The bonds have coupon rate of 4.7 percent and 15 years to maturity. 20,000 zero coupon bonds with a par value of $10,000, a quoted price of 30.45, and 28 years to maturity. Common Stock: 1,550,000 shares of stock selling at a market price of $105. The beta for the stock is 1.25. The company just paid...
Your company currently has $1000 par, 5.5% coupon bonds with 10 years to maturity and a price of $1,078. If you want to issue new 10-year coupon bonds at par, what coupon rate do you need to set? Assume that for both bonds, the next coupon payment is due in exactly six months. (Round to two decimal places.)
Airborne airlines Inc. has a $1000 par value bond outstanding with 20 years to maturity. The bomb carries an annual interest payment of $106 and is currently selling for $860. airborne is in a 40% tax bracket. The firm wishes to know what the after-tax cost of a new bond issue is likely to be. The yield to maturity on the issue will be the same as the yield to maturity on the old issue because the risk immaturity date...
DDDDDD (8 of 10) XYZ Co. issues $1,000 par value, 5.6% annual coupon bonds, with 15 years to maturity. The company sells the bonds for $655. Find the after-tax cost of debt assuming a tax rate of 35% 3.55% 6.62% 6.20% 4.30%
Your firm is planning a 25 year bond issue. The $1000 par value bonds will pay a semi-annual coupon of $59.80. The investment bankers that you have retained for the bond issue estimate that the bonds will sell for $1,183.12. What is the rate of return that your firm is paying on the bonds?
suppose a company will issue new 20-year debt with a par value of $1,000 and a coupon rate of 9%, paid annually. The issue price will be $1,000. The tax rate is 40%. If the flotation cost is 4% of the issue proceeds, then what is the after-tax cost of debt? Disregard the tax shield from the amortization of flotation costs. Round your answer to two decimal places. % What if the flotation costs were 10% of the bond issue?...