The outstanding debt of Home Depot trades with a yield to maturity of 10%. The tax rate of Home Depot is 30%. What is the effective cost of debt of Home Depot? A) 8.05% B) 10% C) 7% D) 7.35%
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- Outstanding debt of Home depot trades with a yield... Please answer the financial accounting questionPogo Stick Co can issue debt yielding 10 percent. The company is paying at a 40 percent tax rate. What is the aftertax cost of debt? (Do not round intermediate calculations. Round the final answer to 2 decimal places.) Cost of debt %What is the actual debt service coverage ratio on these financial accounting question?
- a. Abc Investment Ltd., plans to borrow Ghc100,000 for a 90-day period from Lloyds Finance Company. Abc investment would repay the principal amount plus Ghc5,000 interest at maturity. Determine and calculate the Annual Percentage Rate of the credit to Abc Company Ltd. b. Belinda Limited has annual credit sales of Ghc5 million and cost of sales of GHC1.8 million. The company’s current assets consist of inventory and trade receivables. Current liabilities consist of accounts payables and an overdraft facility with an average interest rate of 10% per annum. The company gives 60 days credit to its customers and is allowed an average of 30 days credit by trade suppliers. The company has an operating cycle of 90 days. Other relevant information: Current ratio of Ait Ltd 1.5:1 Cost of long-term finance to Ait Ltd is 12% per annum Required: Calculate the, (i) Size of the overdraft of Ait Ltd (ii) Net working capital of the company (iii) Total cost of financing its current assets c.…General AccountingDebt Service Coverage Ratio (DSCR or DCR): Assume that a property has a monthly net operating income (NOI) of $25,000, and that a lender has a minimum DSCR requirement of 1.35. What is the maximum loan that you could obtain assuming a 4.5% interest rate and a 30-year term with monthly payments?
- An overview of a firm's cost of debt To calculate the after-tax cost of debt, multiply the before-tax cost of debt by . Three Waters Company (TWC) can borrow funds at an interest rate of 10.20% for a period of six years. Its marginal federal-plus-state tax rate is 25%. TWC’s after-tax cost of debt is (rounded to two decimal places). At the present time, Three Waters Company (TWC) has 10-year noncallable bonds with a face value of $1,000 that are outstanding. These bonds have a current market price of $1,495.56 per bond, carry a coupon rate of 10%, and distribute annual coupon payments. The company incurs a federal-plus-state tax rate of 25%. If TWC wants to issue new debt, what would be a reasonable estimate for its after-tax cost of debt (rounded to two decimal places)? (Note: Round your YTM rate to two decimal place.) 3.38% 2.35% 2.94% 3.53%You are given the following information. What is your liquidity ratio? Annual disposable income: $45,000 Total liabilities: $17,400 Annual savings: $2,400 Long-term assets: $85,000 Current ratio: 2 Debt-to-asset ratio: 0.2 Select one: a. 0.90 b. 0.56 c. 0.89 d. 0.53The SKC Corporation plans to borrow $1,000 for a 90-day penod. At matunity the firm will repay the $1.000 principal amount plus $45 interest What is the effective annual rate of interest (A/F) for the loan? (Select the best choice below) OA 18.00% OB. 450% OC. 1925 % OD. 4.58%
- D=R-(Rx T) or D= Rx (1-T) Assume that Bob's Sporting Store borrows $100,000 at an interest rate of 7% and has a marginal tax rate of 40%. What will their actual cost of debt be?Calculate the WACC using the following information: Debt-Equity ratio is 50%. Cost of debt is 8.00% Cost of equity is 10.00% Company pays tax at 35% a) 7.60% b) 8.40% c) 9.33% d) 9.00%What is the lender's yield for a $350,000 loan amortized over 15 years at a 5.5% interest rate. The buyer paid 2 discount points. Other closing costs including the origination fee totaled $7,500 . Third party payments are $3,500 . A) 5.81% B) 5.97% C) 5.50%