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Jiminys Cricket Farm issued a 30-year, 7 percent semiannual bond 3 years ago. The bond currently sells for 93 percent of its face value. The

Jiminys Cricket Farm issued a 30-year, 7 percent semiannual bond 3 years ago. The bond currently sells for 93 percent of its face value. The companys tax rate is 35 percent. Please complete in excel format using financial functions where necessary.

a) What is the pretax cost of debt?

b) What is the after-tax cost of debt?

c) Which is more relevant, the pretax or the aftertax cost of debt? Why?

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