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In bond refunding analysis, CRA dictates that borrowing expenses on the bond issue must be amortized over 5 years. If the new issue costs $400,000,
In bond refunding analysis, CRA dictates that borrowing expenses on the bond issue must be amortized over 5 years. If the new issue costs $400,000, the corporate tax rate is 30% and the discount rate is 6.5%, what is the net borrowing cost?
a.
$300,264
b.
$325,555
c.
$280,000
d.
$167,282
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