Question
Jiminys Cricket Farm issued a 30-year, 5 percent semiannual coupon bond 3 years ago. The bond currently sells for 94 percent of its face value.
Jiminys Cricket Farm issued a 30-year, 5 percent semiannual coupon bond 3 years ago. The bond currently sells for 94 percent of its face value. The companys tax rate is 22 percent. The book value of the debt issue is $65 million. In addition, the company has a second debt issue, a zero coupon bond with 7 years left to maturity; the book value of this issue is $45 million, and the bonds sell for 74 percent of par.
What is the companys total book value of debt?
Note: Enter your answer in dollars, not millions of dollars, e.g. 1,234,567.
What is the companys total market value of debt?
Note: Enter your answer in dollars, not millions of dollars, e.g. 1,234,567.
What is the aftertax cost of debt?
Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.
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