User Account

All Pages

What is the aftertax cost of debt

Assignment Help Accounting Basics
Reference no: EM133163060

Question - Ninecent Corporation has a target capital structure of 75 percent common stock, 10 percent preferred stock, and 15 percent debt. Its cost of equity is 11 percent, the cost of preferred stock is 5 percent, and the pretax cost of debt is 6 percent. The relevant tax rate is 23 percent.

Required -

a. What is the company's WACC?

b. What is the aftertax cost of debt?

Reference no: EM133163060

Questions Cloud

Find the monthly number of the bag : Find the monthly number of the bag of shredded lettuce for both processes to realize $6,000 profit using Excel GOAL SEEK tool
How delivery systems exhibit distinct trade-off choices : Evaluate the importance of separating out delivery systems with different OWC and the ongoing need to refocus and realign delivery systems
Does approach seem advisable for a manager to do : 1). What do you think of the way in which Ali was approached by Dr. Shields about her violation of the dress code?
Types of rewards granted to employees : Financial rewards include wages, bonuses, profit sharing, pension plans, paid leaves, and purchase discounts, while non-financial rewards emphasize making life
What is the aftertax cost of debt : Ninecent Corporation has a target capital structure of 75 percent common stock, 10 percent preferred stock. What is the aftertax cost of debt
Concluding findings and limitations : Describe the internal and external factors that support the organizational objectives. Compare how your proposed marketing strategy aligns with legal, ethical,
Types of rewards granted to employees : Financial rewards include wages, bonuses, profit sharing, pension plans, paid leaves, and purchase discounts, while non-financial rewards emphasize making life
What is the max price you should pay for abc stock today : At the end of the year, you expect to receive a $1.89 dividend and $42 from selling the stock. What is the max price you should pay for ABC stock today
How operations interfaces with other business functions : Discuss the dominant influence of local and short-term priorities on decision-making and the need for a systems approach supported by theory

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Theory of interest - term structure of interest rates

Term Structure of Interest Rates

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

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