A company has outstanding long-term bonds with a face value of $1,000, a 10% coupon rate, 25
Question:
A company has outstanding long-term bonds with a face value of
$1,000, a 10% coupon rate, 25 years remaining until maturity, and a current market value of $1,214.82. If it pays interest semiannually, then what is the nominal annual pre-tax required rate of return on debt? (8%) If the company’s tax rate is 40%, what is the after-tax cost of debt?
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 100% (QA)
Answered By
Ashington Waweru
I am a lecturer, research writer and also a qualified financial analyst and accountant. I am qualified and articulate in many disciplines including English, Accounting, Finance, Quantitative spreadsheet analysis, Economics, and Statistics. I am an expert with sixteen years of experience in online industry-related work. I have a master's in business administration and a bachelor’s degree in education, accounting, and economics options.
I am a writer and proofreading expert with sixteen years of experience in online writing, proofreading, and text editing. I have vast knowledge and experience in writing techniques and styles such as APA, ASA, MLA, Chicago, Turabian, IEEE, and many others.
I am also an online blogger and research writer with sixteen years of writing and proofreading articles and reports. I have written many scripts and articles for blogs, and I also specialize in search engine
I have sixteen years of experience in Excel data entry, Excel data analysis, R-studio quantitative analysis, SPSS quantitative analysis, research writing, and proofreading articles and reports. I will deliver the highest quality online and offline Excel, R, SPSS, and other spreadsheet solutions within your operational deadlines. I have also compiled many original Excel quantitative and text spreadsheets which solve client’s problems in my research writing career.
I have extensive enterprise resource planning accounting, financial modeling, financial reporting, and company analysis: customer relationship management, enterprise resource planning, financial accounting projects, and corporate finance.
I am articulate in psychology, engineering, nursing, counseling, project management, accounting, finance, quantitative spreadsheet analysis, statistical and economic analysis, among many other industry fields and academic disciplines. I work to solve problems and provide accurate and credible solutions and research reports in all industries in the global economy.
I have taught and conducted masters and Ph.D. thesis research for specialists in Quantitative finance, Financial Accounting, Actuarial science, Macroeconomics, Microeconomics, Risk Management, Managerial Economics, Engineering Economics, Financial economics, Taxation and many other disciplines including water engineering, psychology, e-commerce, mechanical engineering, leadership and many others.
I have developed many courses on online websites like Teachable and Thinkific. I also developed an accounting reporting automation software project for Utafiti sacco located at ILRI Uthiru Kenya when I was working there in year 2001.
I am a mature, self-motivated worker who delivers high-quality, on-time reports which solve client’s problems accurately.
I have written many academic and professional industry research papers and tutored many clients from college to university undergraduate, master's and Ph.D. students, and corporate professionals. I anticipate your hiring me.
I know I will deliver the highest quality work you will find anywhere to award me your project work. Please note that I am looking for a long-term work relationship with you. I look forward to you delivering the best service to you.
3.00+
2+ Reviews
10+ Question Solved
Related Book For
Intermediate Financial Management
ISBN: 9781337395083
13th Edition
Authors: Eugene F. Brigham, Phillip R. Daves
Question Posted:
Students also viewed these Business questions
-
Here is an interesting take on the future of cars. Is this beyond EVs? What are your thoughts? Watch the TED talk on YouTube by Alex Koster entitled ' What would the dream car of the future be like"?
-
HKs marketing director is concerned about having the correct number of dealers in the areas where sales are expected to occur for the new motor vessels. Based on his research, he has forecasted the...
-
Assume for simplicity that these payments continue for 20 years and then cease. The interest rate is 4% . You plan to cover this obligation by investing in 5- and20-year maturity Treasury strips.(a)...
-
A billboard at the top of a building is being illuminated by a projection light (L) that is 103 feet from the base of the building as shown in the figure. Determine how tall the billboard if its...
-
In a certain library the first shelf is 15.0 cm off the ground, and the remaining four shelves are each spaced 38.0 cm above the previous one. If the average book has a mass of 1.40 kg with a height...
-
The open-loop transfer function of a control system is as follows: Determine the value of \(k\) so that the closed-loop system has an underdamped response to a unit step input. Moreover, determine...
-
How does make determine whether a target needs to be rebuilt?
-
1. What are the costs to other stakeholders in society beyond those that Reuters included? How would these costs be estimated? 2. Has the cost of lost reputation been included by Reuters? If no, how...
-
Suzanne Michaels from Howie's Pizza was asked to calculate the break-even point for a new line of gourmet pizzas (prebaked, ready to take home). The selling price will be $25 per pizza. The labor...
-
Does the component cost of preferred stock include or exclude flotation costs? Explain.
-
Is the relevant cost of debt, when calculating the WACC, the interest rate on already outstanding debt or the rate on new debt? Why?
-
In Exercises verify that the infinite series diverges. 18 n=0 6/ n
-
Create a 1-2 page memo highlighting the analysis, comparison, and conclusions to be drawn from looking at the cost of capital and returns on capital for your companies.
-
Do a bit of research and compare investing in stocks versus in a savings account by listing and explaining two positive things and two negative things about each method of investing. Bank stocks...
-
Identify a disadvantage of the percentage of sales or profits method used by businesses for setting advertising budgets.
-
Why is an audit report necessary?
-
low productivity and increased rescheduling costs Consider strong supporting evidence, pros, and cons. Is this solution realistic? Present solutions with detailed justification, using both...
-
The objective of an experiment performed by our students is to determine the effect of pin fins on the thermal resistance between a flat plate and an airstream. A 25.9-mm-square polished aluminum...
-
A survey of 70 college freshmen asked whether students planned to take biology, chemistry, or physics during their first year. Use the diagram to answer each question. How many of the surveyed...
-
What is the first day that an individual could sell a capital asset purchased on March 31, 2017 and have a holding period of more than one year?
-
Phil, a cash-basis taxpayer, sells the following marketable securities, which are capital assets during 2017. Determine whether the gains or losses are long-term or short-term. Also determine the net...
-
How might the current treatment of capital losses discourage an individual investor from purchasing stock of a high-risk, start-up company?
-
What is the role of standardized work in lean production, and how does it contribute to process efficiency?
-
How does lean production incorporate the concept of "pull" to synchronize production with customer demand?
-
The City of Round Lake receives a contribution of $20 million. The donor stipulates that the money is to be invested. The principal is to remain intact, and the investment proceeds are to be used to...
Study smarter with the SolutionInn App