What is aftertax cost of debt

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Reference no: EM132058872

Mullineaux Corporation has a target capital structure of 60 percent common stock, 5 percent preferred stock, and 35 percent debt. Its cost of equity is 12 percent, the cost of preferred stock is 5 percent, and the pretax cost of debt is 7 percent. The relevant tax rate is 35 percent.

a. What is Mullineaux’s WACC? (Round your answer to 2 decimal places. (e.g., 32.16))

WACC %

b. What is the aftertax cost of debt? (Round your answer to 2 decimal places. (e.g., 32.16))

Cost of debt %

Reference no: EM132058872

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