Question
A company's 6% coupon rate, semiannual payment, $1,000 par value bond that matures in 20 years sells at a price of $588.22. The company's federal-plus-state
A company's 6% coupon rate, semiannual payment, $1,000 par value bond that matures in 20 years sells at a price of $588.22. The company's federal-plus-state tax rate is 30%. What is the firm's after-tax component cost of debt for purposes of calculating the WACC? (Hint: Base your answer on the nominal rate.) Round your answer to two decimal places.
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Financial Forensics Body Of Knowledge
Authors: Darrell D. Dorrell, Gregory A. Gadawski
1st Edition
0470880856, 978-0470880852
