Calculate the cost of debt for the company

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Question - Cost of Debt - Wellness Limited is a chain of diagnostic centres based out of North India. They want to expand their operations in South India and want to open their diagnostic centres at five locations. For this purpose, they are looking to buy five plots worth a total of 25 crore. This entire amount is taken in the form of debt from outsiders. The breakup of the amount is as follows:

Bank loan of 10 crore @ 12% interest

5 crore as debt from Zeta Financial Company @ 8% interest rate

2 crore from an ex-partner in the company @ 10% interest rate

8 crore by issuing bonds @ 5% interest rate

Calculate the cost of debt for the company.

Reference no: EM133145762

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