Ying Import has several bond issues outstanding, each making semiannual interest payments. The bonds are listed in the table below. Coupon Rate Maturity Face Value $ 8.60% Bond 1 2 3 4 6.60 8.30 8.80 Aftertax cost of debt Price Quote 106.1 94.3 104.9 94.7 6 years 9 years 16.5 years 26 years 20,000,000 38,000,000 43,000,000 58,000,000 If the corporate tax rate is 21 percent, what is the aftertax cost of the company's debt? Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.

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
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Ying Import has several bond issues outstanding, each making semiannual interest payments. The bonds are listed in the table below.
Coupon Rate
Face Value
$
8.60%
Bond
H23 &
1
4
6.60
8.30
8.80
Aftertax cost of debt
Price Quote
106.1
94.3
104.9
94.7
%
Maturity
6 years
9 years
16.5 years
26 years
If the corporate tax rate is 21 percent, what is the aftertax cost of the company's debt?
Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.
20,000,000
38,000,000
43,000,000
58,000,000
Transcribed Image Text:Ying Import has several bond issues outstanding, each making semiannual interest payments. The bonds are listed in the table below. Coupon Rate Face Value $ 8.60% Bond H23 & 1 4 6.60 8.30 8.80 Aftertax cost of debt Price Quote 106.1 94.3 104.9 94.7 % Maturity 6 years 9 years 16.5 years 26 years If the corporate tax rate is 21 percent, what is the aftertax cost of the company's debt? Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. 20,000,000 38,000,000 43,000,000 58,000,000
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