Cost of debt using both methods (YTM and the approximation formula) rate. As a result of current interest rates, the bonds can be sold for C each before incurring flotation costs of $25 per bond. The firm is in the 35% tax bracket urrently, Warren Industries can sell par-value bonds paying annual interest at a 1,100 a. Find the net proceeds from the sale of the bond, N b. Calculate the bond's yield to maturity (YTM) to estimate the before-tax and after-tax costs of debt c. Use the approximation formula to estimate the before-tax and after-tax costs of debt. a. The net proceeds from the sale of the bond, Na is (Round to the nearest dollar.) b. Using the bond's YTM, the before-tax cost of debt is ?96. (Round to two decimal places.) Using the bond's YTM, the after-tax cost of debt is % Round to two decimal places) c. Using the approximation formula, the before-tax cost of debt is 1% Round to two decimal places Using the approximation formula, the after-tax cost of debt is %. (Round to two decimal places)