Problem 14-24 Calculating the Cost of Debt (LO3)

Cote Import has several bond issues outstanding, each making semiannual interest payments. The bonds are listed in the following table.

Bond		Coupon Rate		Price Quote	Maturity		Face Value
1			6.00	%			103.26			5	years		$	45,000,000
2			7.50				110.58			8	years			40,000,000
3			7.20				109.93			15.5	years			50,000,000
4			6.80				102.83			25	years			65,000,000

If the corporate tax rate is 34%, what is the after-tax cost of the companys debt? (Do not round intermediate calculations. Round the final answer to 2 decimal places.)

Solve on a financial calculator.

Cost of debt %