Avicorp has a$ 14.5million debt issue outstanding

Question # 00507039 Posted By: dr.tony Updated on: 04/02/2017 02:42 AM Due on: 04/02/2017
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Avicorp has a$ 14.5million debt issue outstanding, with a5.8 %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 at96 %of par value.

a. What is Avicorp's pre-tax cost of debt? (Round to four decimal places as needed.)

b. If Avicorp faces a 30 % tax rate, what is its after-tax cost of debt?

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  1. Tutorial # 00503771 Posted By: dr.tony Posted on: 04/02/2017 02:43 AM
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