What is the companys pre tax cost of debt

Reference no: EM133491932

Question: Calculate without excel, Nobleford Inc. is trying to determine its cost of debt. The firm has a debt issue outstanding with 23 years to maturity that is quoted at97% of face value. The issue makes semiannual payments and has an embedded cost of 5% annually.

Assume the par value of the bond is $1,000.what is the company's pre tax cost of debt? if the tax rate is 35% , what is the after tax cost of debt?

Reference no: EM133491932

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