Problemtriplin corporations marginal tax rate is 35 it can, Ask an Expert

Finance

Problem:

Triplin Corporation's marginal tax rate is 35%. It can issue 10-year bonds with an annual coupon rate of 7% and a par value of $1,000. After $12 per bond flotation costs, new bonds will net the company $966 in proceeds.

Required:

Question: Determine the appropriate after-tax cost of new debt for Triplin to use in a capital budgeting analysis.

Note: Be sure to show how you arrived at your answer.

View complete question

Basic Finance, Finance

Category:- Basic Finance
Reference No.:- M91148628

Have any Question?Write your Review or question?

Related Questions in Basic Finance

Squash delight inc has the following balance

Squash Delight Inc. has the following balance sheet: Assets Cash $ 45,000 Accounts receivable 295,000 Fixed assets 772,000 Total assets $ 1,112,000 Liabilities Accounts payable $ 296,000 ...

When restating nonmonetary asset accounts the price index

When restating nonmonetary asset accounts, the price index at the current date represents the price index from which the conversion is made, and the price index at the time of acquisition represents the index to which th ...

What are some alternative methods that can help teach

What are some alternative methods that can help teach companies about the culture of where they want to do business before they make the move?

Suppose that a mutual fund that tracks the sampp has mean

Suppose that a mutual fund that tracks the S&P has mean E(Rm) = 16% and standard deviation σm = 10%, and suppose that the T-bill rate Rf = 8%. Answer the following questions: (a) What is the expected return and standard ...

Express in other words explain the concept of cost of

Express in other words explain the concept of cost of capital? Do you believe that a firm should use the same cost of capital for all of its projects? Why or why not?

Your are the investment advisor for your aunt who would

Your are the investment advisor for your aunt who would like to invest $1,250,000 with a AAA rated insurance company that will pay her a "monthly" fixed-payment annuity for the next 20-years. Calculate the monthly paymen ...

You currently have 120000 in a bond account and 500000 in a

You currently have $120,000 in a bond account and $500,000 in a stock account. You plan to add $5,000 per year at the end of each of the next 10 years to your bond account. The stock account will earn a return of 10.5 pe ...

Is an institutional client different from an institutional

Is an institutional client different from an institutional investor? If so could you please please give an example of each just so I understand?

A perpetual bond sells for 885 and pays a semiannual coupon

A perpetual bond sells for $885 and pays a semiannual coupon in the amount of $34. What is the annualized yield for the bond?

Follow up - calculating a bonds yield to maturity amazon

Follow Up - Calculating a Bonds Yield to Maturity Amazon has a bond with a 10% annual coupon rate, 15 years to maturity and a par value of $1000. The current price is $928.09. Calculate the Yield to Maturity.

4,153,160 Questions Asked
13,132 Experts
2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Recent Questions

Ask Basic Finance Expert