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Ying Import has several bond issues outstanding, each making semiannual interest payments. The bonds are listed...

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Finance

Ying Import has several bond issues outstanding, each makingsemiannual interest payments. The bonds are listed in the followingtable.

BondCoupon RatePrice QuoteMaturity  Face Value
17.0%105.766years$50,000,000
28.5115.529years45,000,000
38.2114.0716.5years65,000,000
47.8103.3126years72,000,000

If the corporate tax rate is 25 percent, what is the aftertaxcost of the company’s debt? (Do not round intermediatecalculations and enter your answer as a percent rounded to 2decimal places, e.g., 32.16.)

Answer & Explanation Solved by verified expert
4.0 Ratings (606 Votes)
Number of bonds FVpar value Bond 150000000100050000 Bond 245000000100045000 Bond 365000000100065000 Bond 472000000100072000 Bond 1 K Nx2 Bond Price Coupon1 YTM2k Par value1 YTM2Nx2 k1 K 6x2 10576 710002001 YTM200k 10001 YTM2006x2 k1 YTM 585 Bond 2 K Nx2 Bond Price Coupon1 YTM2k Par value1    See Answer
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Ying Import has several bond issues outstanding, each makingsemiannual interest payments. The bonds are listed in the followingtable.BondCoupon RatePrice QuoteMaturity  Face Value17.0%105.766years$50,000,00028.5115.529years45,000,00038.2114.0716.5years65,000,00047.8103.3126years72,000,000If the corporate tax rate is 25 percent, what is the aftertaxcost of the company’s debt? (Do not round intermediatecalculations and enter your answer as a percent rounded to 2decimal places, e.g., 32.16.)

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