13. (a) TBC Plc has 10,000 of 8 irredeemable debentures in issue which have a current market price of 92 per 100 of nominal value. If the corporation tax rate is 28 per cent what is the cost of the debt capital?

(b) BBC Plc has redeemable 10 per cent loan stock, redeemable on 31st December, 2020, with a current market price on 31st December, 2016 of 96.03 per 100 nominal. The corporation tax rate is 28 per cent. What is the after-tax cost of the loan stock capital?