Pearce's Cricket Farm issued a 18-year, 8% semiannual bond 3 years ago. The bond currently sells for 92% of its face value. The company's tax rate is 40%.

Suppose the book value of the debt issue is $45 million. In addition, the company has a second debt issue on the market, a zero coupon bond with 12 years left to maturity; the book value of this issue is $35 million and the bonds sell for 51% of par. Assume the par value of the bond is $1,000.

What is the company's total book value of debt?

What is the company's total market value of debt?

What is your best estimate of the after-tax cost of debt?