After tax cost of debt is calculated by solving the below equation:
Case | Yield | Corporate Tax Rate | After tax cost of debt |
a | 4.00% | 10.00% | 4..00 x (1-0.1) = 3.60% |
b | 6.60% | 20.00% | 6.60 x (1-0.2) = 5.28% |
c | 6.00% | 20.00% | 6.00 x (1-0.2) = 4.80% |
Calculate the aftertax cost of debt under each of the following conditions. (Do not round intermediate...
Calculate the aftertax cost of debt under each of the following conditions. (Do not round intermediate calculations. Input your answers as a percent rounded to 2 decimal places.) Aftertax Cost of Debt la. b. C. Yield 12.0% 13.0% 12.0% Corporate Tax Rate 34% 20% 0%
Calculate the aftertax cost of debt under each of the following conditions. (Do not round intermediate calculations. Input your answers as a percent rounded to 2 decimal places.) Yield Corporate Tax Rate Aftertax Cost of Debt a. 8.0 % 18 % % b. 12.0 % 34 % % c. 10.6 % 15 % %
Problem 11-5 Aftertax cost of debt [LO11-3]| Calculate the aftertax cost of debt under each of the following conditions. (Do not round in: answers as a percent rounded to 2 decimal places.) Corporate Tax Rate 15 % Aftertax Cost of Debt Yield 9.0 % 9.0% 10.0% a. b. C. 20%
1. Calculate the aftertax cost of debt under each of the following conditions. (Do not round intermediate calculations. Input your answers as a percent rounded to 2 decimal places.) Yield Corporate Tax Rate Aftertax Cost of Debt a. 11.0 % 27 % % b. 11.4 % 20 % % c. 9.5 % 0 % % 2. Delta Corporation has the following capital structure: Cost (aftertax) Weights Weighted Cost Debt (Kd) 9.1 % 40 % 3.64 % Preferred stock...
Please highlight the answers 7 Problem 11-5 Aftertax cost of debt [LO11-3] Calculate the aftertax cost of debt under each of the following conditions. (Do not round im answers as a percent rounded to 2 decimal places.) points skopped Aftertax Cost of Debt согрогate Tax Rate Yield % 50% 11% а. edook 25 % % 7.0% b. 64% 21 % % Hint C. Print References Mci Graw <Prev 7 of 10 Ne Esc
Evans Technology has the following capital structure. 35% Debt Common equity The aftertax cost of debt is 8.00 percent, and the cost of common equity (in the form of retained earnings) is 15.00 percent. a. What is the firm's weighted average cost of capital? (Do not round Intermediate calculations. Input your answers as a percent rounded to 2 decimal places.) Weighted Cost Debt Common equity Weighted average cost of capital An outside consultant has suggested that because debt is cheaper...
Evans Technology has the following capital structure. Debt Common equity The aftertax cost of debt is 9.00 percent, and the cost of common equity in the form of retained earnings) is 16.00 percent. a. What is the firm's weighted average cost of capital? (Do not round intermediate calculations. Input your answers as a percent rounded to 2 decimal places.) Weighted Cost Debt Common equity Weighted average cost of capital 0.001% An outside consultant has suggested that because debt is cheaper...
Evans Technology has the following capital structure. Debt 40 % Common equity 60 The aftertax cost of debt is 7.00 percent, and the cost of common equity (in the form of retained earnings) is 14.00 percent. a. What is the firm’s weighted average cost of capital? (Do not round intermediate calculations. Input your answers as a percent rounded to 2 decimal places.) An outside consultant has suggested that because debt is cheaper than equity, the firm should switch to a...
The treasurer of Riley Coal Co. is asked to compute the cost of fixed income securities for her corporation. Even before making the calculations, she assumes the aftertax cost of debt is at least 2 percent less than that for preferred stock. Debt can be issued at a yield of 10.4 percent, and the corporate tax rate is 25 percent. Preferred stock will be priced at $61 and pay a dividend of $5.20. The flotation cost on the preferred stock...
The treasurer of Riley Coal Co. is asked to compute the cost of fixed income securities for her corporation. Even before making the calculations, she assumes the aftertax cost of debt is at least 3 percent less than that for preferred stock. Debt can be issued at a yield of 11.6 percent, and the corporate tax rate is 40 percent. Preferred stock will be priced at $76 and pay a dividend of $7.00. The flotation cost on the preferred stock...