Problema bond that has a 1000 par value face value and a, Ask an Expert

Accounting

Problem:

A bond that has a $1,000 par value (face value) and a contract or coupon interest rate of 12.7% that is paid semi annually. The bond is currently selling for a price of $1,128 and will mature in 10 years. The firm's tax rate is 34%

Required:

Question: What is the after-tax cost of debt from the is what percent?

Note: Please show how to work it out.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M91166172

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