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Jiminy's Cricket Farm issued a 30-year, 7 percent semiannual bond 9 years ago.

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Jiminy's Cricket Farm issued a 30-year, 7 percent semiannual bond 9 years ago. The bond currently sells for 88 percent of its face value. The book value of this debt issue is $102 million. In addition, the company has a second debt issue, a zero coupon bond with 12 years left to maturity, the book value of this issue is $61 million, and it sells for 58.5 percent of par. The company?s tax rate is 30 percent.;Requirement 1;What is the total book value of debt? (Do not round intermediate calculations. Enter your answer in dollars, not millions of dollars (e.g., 1,234,567).);Total book value of debt $;Requirement 2;What is the total market value of debt? (Do not round intermediate calculations. Enter your answer in dollars, not millions of dollars (e.g., 1,234,567).);Total market value $;Requirement 3;What is the aftertax cost of debt? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).);Aftertax cost of debt %;Additional Requirements;Level of Detail: Show all work

 

Paper#21128 | Written in 18-Jul-2015

Price : $27
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