26)PWCV, Inc. has bonds outstanding that mature in 6 years, pay interest annually, and have a coupon rate of 4.8 percent. These bonds have a face value of $1,000 and a current market price of $1,047.52. What is the company's aftertax cost of debt if its tax rate is 18 percent? Group of answer choices 3.2% 3.9% 4.1% 4.8%

Q: Avicorp has a $13.6 million debt issue​ outstanding, with a 6.2 %coupon rate. The debt has​…

A: a.Computation of the pre-tax cost of debt:

Q: JP Smith, Inc has an outstanding bond issue, which has eight years remaining to maturity and a…

A: Par value = $ 1000 Coupon rate = 4.250% Semi annual coupon amount = 1000*0.0425*1/2 = $ 21.25 Years…

Q: Neptune Corporation's bonds have 20-years to maturity and a coupon rate of 8.5%. Interest is paid…

A: Bonds are debt instruments that are issued by entities to raise funds and meet their capital…

Q: Scherr Enterprises has a series of 7 percent coupon bonds outstanding with a $1,000 par value. The…

A: Face value = $1000 Coupon = 7% of $1000 = $70 Duration till maturity (n) = 10 years Bond price =…

Q: Olympic Sports has two issues of debt outstanding. One is an 8% coupon bond with a face value of $21…

A: The conceptual formula used:

Q: XYZ's Electrical has a bond issue outstanding with ten years to maturity. These bonds have a $1,000…

A: The cost of debt is the effective rate that is paid by the company on its debt. The market value of…

Q: 3. Avicorp has a $12.3 million debt issue​ outstanding, with a 6.1% coupon rate. The debt has​…

A: Bonds: Bonds are the liabilities of the company which is issued to raise the funds required to…

Q: Five years ago, ABC Firms issued $1,000 par value bonds with a 12% coupon rate and an original…

A: Following Formula will be used:

Q: Several years ago, the ABC Company sold a $1,000 par value bond that now has 20 years to maturity…

A:

Q: Estimate Dixon's marginal pre-tax cost of debt.

A: Yield to Maturity refers to the rate of interest earned till the maturity of the bond by the bond…

Q: Olympic Sports has two issues of debt outstanding. One is an 8% coupon bond with a face value of $24…

A: Given:  Option 1:Face Value  =  $24 millionCoupon Rate  =  8%Years to Maturity  =  15 yearsYield to…

Q: AAPL Inc. is a publicly traded company that has $120 million in bank loan on its books, with a…

A: Cost of debt: It is the interest that the company pays to its debt holders.

Q: 9. Avicorp has a $11.7 million debt issue​ outstanding, with a 5.8% coupon rate. The debt has​…

A: The cost of debt is the yield to maturity of a bond. It is the rate at which borrowed funds can be…

Q: Mojo Mining has a bond outstanding that sells for $1,052 and matures in 22 years. The bond pays…

A: Given:

Q: A company has outstanding long-term bonds with a face value of$1,000, a 10% coupon rate, 25 years…

A: COUPON RATE 10.00% YEARS OR PERIOD  25 PRESENT VALUE 1214.82 TAX  40% FACE VALUE 1000

Q: DQ, Inc. expects EBIT to be approximately $11.4 million per year for the foreseeable future, and it…

A: EBIT - $11.40 million Bond :no of bonds- 20,000 Interest rate -10% Face value - $1000 Annual…

Q: Olympic Sports has two issues of debt outstanding. One is a 7% coupon bond with a face value of $26…

A: The question is based on the concept of calculation of cost of debt before tax and after tax .…

Q: Boulder Furniture has bonds outstanding that mature in 13 years, have a 6 percent coupon, and pay…

A: Calculation of Yield to Maturity:Excel Spreadsheet:

Q: Comet Chasers has a bond outstanding that sells for $1,052 and matures in 22 years. The bond pays…

A: Excel Spreadsheet:

Q: You are given the following information for Cleen Power Co. Assume the company’s tax rate is 30…

A: Calculation of WACC:The WACC is 15.23%.Excel Spreadsheet:

Q: ​Currently, Warren Industries can sell 20-year​, ​$1,000​-par-value bonds paying annual interest at…

A: Issue price = $ 960 Flotation cost = $ 35 Tax rate = 22% Par value = $ 1000 Coupon rate = 14% Coupon…

Q: The Maximus Corporation is considering a new investment, which would be financed from debt. Maximus…

A: Data given: FV =$1000 CP=Current Price of bond = $979 n= 15 years r= coupon rate= 8% Tax rate = 35%…

Q: Simple Foods has a zero coupon bond issue outstanding that matures at nine years. The bonds are…

A: The company has a zero coupon bond that matures in 9 years with semiannual compounding.Par Value…

Q: Company B has $50 million of bonds outstanding (face value).  These are 10-year bonds, and they are…

A: The cost of raising the funds through borrowing or the financing cost is termed as the required rate…

Q: The H-mart’s currently outstanding  6 percent annual coupon bonds have maturity of 20 years with par…

A: Annual coupon rate is 6% Maturity is 20 years Par value is $1,000 Current price of bond is $850 Tax…

Q: Lionel Company has 1,500 units of bonds outstanding. Each unit has $100 face value, 6% coupon rate…

A: Here, Units of Bond is 1,500 Face Value of Each Bond is $100 Coupon Rate is 6% Coupon Compounding…

Q: 23. Wind Power Systems has 20-year, semi-annual bonds outstanding with a 5 percent coupon. The face…

A: The pre-tax cost of debt is the bond's yield or market interest rate. Yield refers to the expected…

Q: Mary's Institute issued a 30 year, 8% semi-annual bond 3 years ago. The bond currently sells for 93%…

A: Given:30 years, 8% semi annully bond, 3 year ago.selling at 93% of face value Tax rate=35%To…

Q: ACT Inc. has a $1,000 (face value), 20 year bond issue selling for $1,229.40 that pays  an annual…

A: 1. What would be BAT's current before-tax component cost of debt   It can be calculated using rate…

Q: J&R Renovation, Inc., is trying to determine its cost of debt. The firm has a debt issue…

A: Calculation of Pre-tax Cost of Debt and After-tax Cost of Debt:The pre-tax cost of debt is 8.28% and…

Q: Olympic Sports has two issues of debt outstanding. One is a 7% coupon bond with a face value of $30…

A: In this question we need to calculate the before-tax cost of debt for Olympic and Olympic's…

Q: Olympic Sports has two issues of debt outstanding. One is a 9% coupon bond with a face value of $38…

A: The weighted average cost of capital (WACC) is the average interest rate that a firm is required to…

Q: Olympic Sports has two issues of debt outstanding. One is a 5% coupon bond with a face value of $33…

A: Cost of debt is the rate at which the firm procures the debt from external source of finance. The…

Q: Oberon, Inc. has a $20 million (face value) 8-year bond issue selling for 99 percent of par that…

A: Face value = $20,000,000 Price = 99% Price in $ = 20,000,000*0.99 = $19,800,000 Coupon rate = 8.05%…

Q: What is the company's pretax cost of debt? (Do not round intermediate calculations and enter your…

A: Information Provided: Term = 20 years Face value = 100 Price = 108 Coupon rate = 5% (semi-annual…

Q: PDQ, Inc. expects EBIT to be approximately $12.2 million per year for the foreseeable future, and it…

A: Operating profit ia known also knows as Earnings Before Interest and Taxes. Net Income os calculated…

Q: Olympic Sports has two issues of debt outstanding. One is a 4% coupon bond with a face value of $34…

A: Let par value of bond =100 Coupon =4%=4 YEILD to MATURITY =5% Years to MATURITY =15 Present value…

Q: Suppose ABE Co. issued a 20-year, 8 percent coupon rate bond three years ago. The bond is currently…

A: YEARS (20-3) 17 COUPON RATE 8% PMT (COUPON AMOUNT) $80 PRESENT VALUE $715 FACE VALUE (FV)…

Q: A company has outstanding 20-year noncallable bonds with a face value of $1,000,an 11% annual…

A: Required rate of interest is the return provided by the bond. At required rate, the present value of…

Q: Sandhill has determined that it could issue $1050 face value bonds with an 8 percent coupon paid…

A: Pre tax cost of debt is yield to maturity on the bond  As we get tax deduction from interest…

Q: ACT Inc. has a $1,000 (face value), 30 year bond issue selling for $838.88 that pays an annual…

A: Cost of Debt: It is the rate of return that is paid by companies on its debt obligations. These debt…

Q: Carraway Seed Company is issuing a $1,000 par value bond that pays 8 percent annual interest and…

A: Cost of debt is the total expense incurred while raising funds through debt instruments. It includes…

Q: Dixon Corp has 6% coupon bonds outstanding that have a remaining maturity of 12 years. These bonds…

A: Given: Coupon rate = 6% Years to maturity = 12 years Current price = $1,080 Face value = $1,000 Tax…