Sunrise, Incorporated, is trying to determine its cost of debt. The firm has a debt issue outstanding with $23$ years to maturity that is quoted at $93$ percent of face value. The issue makes semiannual payments and has an embedded cost of $7$ percent annually.

a$.$

What is the company$$s pretax cost of debt? $($Do not round intermediate calculations and enter your answer as a percent rounded to $2$ decimal places, e$.$g$.,32\mathrm{.}16.)$

b$.$

If the tax rate is $22$ percent, what is the aftertax cost of debt? $($Do not round intermediate calculations and enter your answer as a percent rounded to $2$ decimal places, e$.$g$.,32\mathrm{.}16.)$Problem $14-6$ Calculating Cost of Debt $[$LO$2]$

Sunrise, Incorporated, is trying to determine its cost of debt. The firm has a debt issue

outstanding with $23$ years to maturity that is quoted at $93$ percent of face value. The

issue makes semiannual payments and has an embedded cost of $7$ percent annually.

a$.$ What is the company's pretax cost of debt? $($Do not round intermediate calculations

and enter your answer as a percent rounded to $2$ decimal places, e$.$g$.,32\mathrm{.}16.)$

b$.$ If the tax rate is $22$ percent, what is the aftertax cost of debt? $($Do not round

intermediate calculations and enter your answer as a percent rounded to $2$ decimal

places, e$.$g$.,32\mathrm{.}16.)$