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Business, 06.05.2021 14:00 maxandalexplayz

Jiminy's Cricket Farm issued a 30-year, 6.5 percent semiannual bond 9 years ago. The bond currently sells for 108.5 percent of its face value. The book value of this debt issue is $151 million. In addition, the company has a second debt issue, a zero coupon bond with 13 years left to maturity; the book value of this issue is $97 million, and it sells for 62.4 percent of par. The company’s tax rate is 21 percent. 1) what is the total book value of debt?

2) what is the total market value of debt?

3) what is the after tax cost of the 6.5 percent coupon bond?

4) what is the after tax cost of the zero coupon bond?

5) What is the after tax cost of debt?

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Jiminy's Cricket Farm issued a 30-year, 6.5 percent semiannual bond 9 years ago. The bond currently...
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