https://aplusnursingexperts.com/wp-content/uploads/2019/10/LOGO-APLUS-300x60.png 0 0 David Munene https://aplusnursingexperts.com/wp-content/uploads/2019/10/LOGO-APLUS-300x60.png David Munene2019-06-29 02:17:152019-06-29 02:17:15(Cost of debt) Belton Distribution Company
(Cost of debt) Belton Distribution Company
(Cost of debt) Belton Distribution Company is issuing a $1, 000 par value bond that pays 7.0 percent annual interest and matures in 15 years that is paid semiannually. Investors are willing to pay $958 for the bond. The company is in the 18 percent marginal tax bracket.
What is the firm’s after-tax cost of debt on the bond?