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Shama's Tours Incorporated plans to issue a 20-year bond. Shama's Tours expects the $1,000 par value bonds to sell for $995 each. Issuance costs are
Shama's Tours Incorporated plans to issue a 20-year bond. Shama's Tours expects the $1,000 par value bonds to sell for $995 each. Issuance costs are expected to be $5 per $1,000 bond, and the coupon rate is 11 7/8 percent. Of the effective tax rate is 40 percent.
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To calculate the aftertax cost of debt to Shamas Tours we need to first determine the net proceeds f...
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Foundations of Finance The Logic and Practice of Financial Management
Authors: Arthur J. Keown, John D. Martin, J. William Petty
8th edition
132994879, 978-0132994873
