Problem 14-22 Calculating the Cost of Debt [LO2] Ying Import has several bond issues outstanding, each making semiannual interest payments. The bonds are listed in the following table. Bond 1 234 Coupon Rate Price Quote 5.2% 6.8 6.7 6.0 104.96 113.72 112.27 101.51 Cost of debt Maturity 6 years 9 years 16.5 years 26 years % Face Value $ If the corporate tax rate is 23 percent, what is the aftertax cost of the company's debt? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) 58,000,000 53,000,000 73,000,000 80,000,000
Problem 14-22 Calculating the Cost of Debt [LO2] Ying Import has several bond issues outstanding, each making semiannual interest payments. The bonds are listed in the following table. Bond 1 234 Coupon Rate Price Quote 5.2% 6.8 6.7 6.0 104.96 113.72 112.27 101.51 Cost of debt Maturity 6 years 9 years 16.5 years 26 years % Face Value $ If the corporate tax rate is 23 percent, what is the aftertax cost of the company's debt? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) 58,000,000 53,000,000 73,000,000 80,000,000
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Vijay
![Problem 14-22 Calculating the Cost of Debt [LO2]
Ying Import has several bond issues outstanding, each making semiannual interest
payments. The bonds are listed in the following table.
Bond
1
234
Coupon
Rate Price Quote
5.2% 104.96
6.8
113.72
6.7
112.27
101.51
6.0
Cost of debt
Maturity
6 years
9 years
16.5 years
26 years
Face Value
$
58,000,000
53,000,000
73,000,000
80,000,000
If the corporate tax rate is 23 percent, what is the aftertax cost of the company's debt?
(Do not round intermediate calculations and enter your answer as a percent rounded
to 2 decimal places, e.g., 32.16.)](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F266fc484-5c67-47d6-992b-66fccc5361b4%2F141f3a4f-7a3d-4bdc-8933-9e71b404b31c%2Fgacbh1_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Problem 14-22 Calculating the Cost of Debt [LO2]
Ying Import has several bond issues outstanding, each making semiannual interest
payments. The bonds are listed in the following table.
Bond
1
234
Coupon
Rate Price Quote
5.2% 104.96
6.8
113.72
6.7
112.27
101.51
6.0
Cost of debt
Maturity
6 years
9 years
16.5 years
26 years
Face Value
$
58,000,000
53,000,000
73,000,000
80,000,000
If the corporate tax rate is 23 percent, what is the aftertax cost of the company's debt?
(Do not round intermediate calculations and enter your answer as a percent rounded
to 2 decimal places, e.g., 32.16.)
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