User Account

All Pages

What component cost of debt should be used

Assignment Help Finance Basics
Reference no: EM132504634

To help finance a major expansion, Miami Development, Inc. sold a noncallable bond several years ago that now has 10 years to maturity. This bond has a 9.50% annual coupon, paid semiannually, it sells at a price of $1,175, and it has a par value of $1,000. MDI's marginal tax rate is 38.00% and new bonds have 3% flotation costs. What component cost of debt should be used in the WACC calculation? Note: Enter your answer rounded off to two decimal points. Do not enter % in the answer box. For example, if your answer is 0.13456 or 13.456% then enter as 13.46 in the answer box.

Reference no: EM132504634

Questions Cloud

What the stock should be accounted for as : Capital contributions received by a company on the issuance of common stock in excess of the par value of the stock should be accounted for as
What is the company weighted average cost of capital : The bonds pay a 15% interest rate, and shareholders require a 10% return. What is the company's weighted average cost of capital (WACC)?
What are patterson dividends in arrears : Patterson declared a dividend of $35,000 during 20X8. Assuming the dividends are cumulative, what are Patterson's dividends in arrears as of 12/31/X8?
Calculate after-tax cash flow at disposal : Genetic Insights has a tax rate of 30%. The asset is sold at the end of six years for $4,214.
What component cost of debt should be used : To help finance a major expansion, Miami Development, Inc. sold a noncallable bond several years ago that now has 10 years to maturity. This bond has a 9.50% an
How much should boy retained earning be adjusted at december : Ignoring income taxes, by how much should Boy's retained earnings be adjusted at December 31, 2032? What Effect of Errors on Retained Earnings.
After-tax and after-inflation rate of return : Assuming that she could earn a 4% after-tax and after-inflation rate of return on their investments, did she save enough?
Find t rounded to 2 decimal places : An initial investment of $1300 (present value) grows to $32500 (future value) in t years. Find t rounded to 2 decimal places.
How an investors financial statement would differ : How an investors' financial statement would differ between assessing they have control over investee and assessing they have significantly influence

Reviews

Write a Review

Finance Basics Questions & Answers

  Financial reporting and analysis

Finance is about Gunns Ltd, a company in dealing with forestry products in Australia. The company has also been listed in Australian Stock Exchange. As many companies producing forestry products, even Gunns Ltd is facing various problems. Due to the ..

  A report on financial accounting

This report is specific for a core understanding for Financial Accounting and its relevant factors.

  Describe the types of financial ratios

Describe the types of financial ratios and other financial performance measures that are used during venture's successful life cycle.

  Differences between sole proprietorship and corporation

Briefly describe the major differences between a sole proprietorship and a corporation

  Prepare a cash budget statement

Calculate the expected value of the apartment in 20 years' time. What is the mortgage loan repayment at the beginning of each month

  What are the implied interest rates

What are the implied interest rates in Europe and the U.S.?

  State pricing theory and no-arbitrage pricing theory

State pricing theory and no-arbitrage pricing theory

  Small business administration

Identify the likely stage for each venture and describe the type of financing each venture is likely to be seeking and identify potential sources for that financing.

  Effect of financial leverage

The Effect of Financial Leverage and working capital management

  Evaluate the basis for the payment to the lender

Evaluate the basis for the payment to the lender and basis for the payment to the company-counterparty.

  Importance of opps, ipps, mpfs and dmepos

Research and discuss the differences and importance of : OPPS, IPPS, MPFS and DMEPOS.

  Time value of money

Time Value of Money project

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd