What is avicorp pre-tax cost of debt

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Reference no: EM131567145

Avicorp has a$ 13.3million debt issue outstanding, with a 6.2 %coupon rate. The debt has semi-annual coupons, with the next coupon is due in six months. The debt matures in five years. It is currently priced at 94 % of par value.

a. What is Avicorp's pre-tax cost of debt?

b. If Avicorp faces a30 %tax rate, what is its after-tax cost of debt?

Reference no: EM131567145

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