Caterpillar Industries sold a 12 year $1,000 face value bond with a 14 percent coupon rate. Interest
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Question:
Caterpillar Industries sold a 12 year $1,000 face value bond with a 14 percent coupon rate. Interest is paid annually. After flotation costs, Caterpillar received $1,130 per bond. Compute the after-tax cost of debt for these bonds if the firm's marginal tax rate is 21 percent.
Related Book For
College Accounting
ISBN: 978-1111528126
11th edition
Authors: Tracie Nobles, Cathy Scott, Douglas McQuaig, Patricia Bille
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