Jiminy's Cricket Farm issued a 30-year, 7.4 percent semiannual bond 9 years ago. The bond currently sells for 93 percent of its face value. The book value of this debt issue is $92 million. In addition, the company has a second debt issue, a zero coupon bond with 12 years left to maturity; the book value of this issue is $62 million, and it sells for 53.5 percent of par. The companys tax rate is 30 percent.

A. What is the aftertax cost of debt?