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Please explain how to find the PMT value of $58.00. Thank you! Galvatron Metals has a bond outstanding with a coupon rate of 5.8 percent
Please explain how to find the PMT value of $58.00. Thank you!
Galvatron Metals has a bond outstanding with a coupon rate of 5.8 percent and semiannual payments. The bond currently sells for $1,954 and matures in 22 years. The par value is $2,000 and the company's tax rate is 21 percent. What is the company's aftertax cost of debt? Explanation $1,954=$58.00{1[1/(1+R)44]}/R+$2,000/R44R=.0299,or2.998YTM=2.990%2YTM=5.99%RD=5.998(1.21)RD=4.738 Step by Step Solution
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