Problem:
Ying Import has several bond issuances outstanding, each making semiannual interest payments. The bonds are listed in table attached. If the corporate tax rate is 34%, what is the aftertax cost of Ying's debt?
| Ying Import |
|
|
|
|
|
Coupon |
Price |
|
Face |
| Bond |
Rate |
Quote |
Maturity |
Value |
| 1 |
8.00% |
$106.38 |
5 years |
10,000,000 |
| 2 |
7.50% |
$98.00 |
8 years |
45,000,000 |
| 3 |
6.40% |
$82.00 |
15 ½ years |
35,000,000 |
| 4 |
9.75% |
$101.50 |
25 years |
45,000,000 |