Step-by-step explanation:
for the demoninator to get to 4 to 12 u times by 3 (4,8,12) so you times the numerator by 3, 3 times 3= 9
so its 9/12
for 6 to get to 12, you times by 2, (6,12) so times the numerator by 2, 1 times 2 is 2
9/12-6/12= 3/12
Answer:
Pretax cost of debt is 5.94%
After tax cost of debt is 4.63%
Step-by-step explanation:
The pretax cost of the debt is the yield to maturity on the debt issuance,which can be computed using the rate formula in excel:
=rate(nper,pmt,-pv,fv)
nper is the number of semi-annual interest payments payable by the bond from year 3 onward ,that is the number of years to maturity 12*2=24
pmt is the semi-annual interest payable by the bond issuer which is face value of the bond ,$1000*5%/2=$25
pv is the current price of the bond which 92% of face value i.e 92%*$1000=$920
fv is the face value of the bond at $1000
=rate(24,25,-920,1000)
rate=2.97%
the rate calculated is a semi-annual rate,annual rate =2.97%*2
=5.94%
The pretax cost of debt is 5.94%
After tax cost of debt=pretax cost of debt*(1-t)
t is the tax rate of 22%
after tax cost of debt =5.94%*(1-22%)
=4.63%
V=<span>πr^2 h/3
V=</span><span>π(3)^2 (4)/3
V=37.7 yd^3 or 36 yd^3</span>
