Magliaro Industries issued a 20-year, 8% semiannual bond 3 years ago. The bond currently sells for 96% of its face value. The companys tax rate is 35%.

Suppose the book value of the debt issue is $40 million. In addition, the company has a second debt issue on the market, a zero coupon bond with 10 years left to maturity; the book value of this issue is $40 million and the bonds sell for 52% of par. Assume the par value of the bond is $1,000.

What is the companys total book value of debt? (Enter the answer in dollars. Omit $ sign in your response.)

Total book value $

What is the companys total market value of debt? (Enter the answer in dollars. Omit $ sign in your response.)

Total market value $

What is your best estimate of the after-tax cost of debt? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places.)

Cost of debt %