Jiminy's 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 company's 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.

a.What is the company's total book value of debt?(Enter your answer in dollars, not millions of dollars, e.g. 1,234,567.)

b.What is the company's total market value of debt?(Enter your answer in dollars, not millions of dollars, e.g. 1,234,567.)c.What is the aftertax cost of debt?(Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

Gnomes R Us is considering a new project. The company has a debt-equity ratio of .79. The company's cost of equity is 14.5 percent, and the aftertax cost of debt is 7.8 percent. The firm feels that the project is riskier than the company as a whole and that it should use an adjustment factor of +4 percent.

a.What is the company's WACC?(Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimalplaces, e.g., 32.16.)b.What discount rate should the firm use for the project?(Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)