1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Savatey [412]
3 years ago
14

J&R Renovation, Inc., is trying to determine its cost of debt. The firm has a debt issue outstanding with 16 years to maturi

ty that is quoted at 106 percent of face value. The issue makes semiannual payments and has a coupon rate of 6 percent annually.What is the company’s pretax cost of debt?
If the tax rate is 35 percent, what is the aftertax cost of debt?
Business
1 answer:
g100num [7]3 years ago
6 0

Answer:

After tax cost of debt = 5.44*(1-0.35)% = 3.54%

Explanation:

PV = 106

PMT = 6/2 =-3

N = 16*2 = 32 semi annual

FV = -100

Semi annual yield = 2.72%

Annual cost of debt = 2.72%*2 = 5.44%

After tax cost of debt = 5.44*(1-0.35)% = 3.54%

Using Rate function in Excel or Financial calculator

You might be interested in
Aggregate supply is best described as the
VladimirAG [237]

Answer:

Total output of all products and services.

Explanation:

Aggregate supply is defined as the total amount of goods and services that firms are willing to sell, at a specific price, within a particular economy.

Aggregate supply is a macroeconomic concept, an aggregate variable, that is used in Keynesian and Neoclassical economics, often in models that put it together with aggregate demand, in what is known as the Aggregate Supply-Aggregate Demand model (AS-AD model).

5 0
3 years ago
Six equal annual contributions are made to a fund, with the first deposit on December 31, 2019. Required: Using the future value
Tasya [4]

Answer:

The answer is $3,888.22

Explanation:

This is an annuity due because the cash flow is being done on the first day of each period.

Annuity is a fixed sum of money paid to or receceived from someone or business every year.

Future Value(FV) = $30,000

Interest rate(i or I/Y) = 10%

Number of years(N)= 6 years

Annuity (PMT) = ?

Using a Financial calculator to solve it (Texa BA II Plus )

Annuity (equal contributions) will be $3,888.22

6 0
3 years ago
Joe Keller and Ed Keller are brothers and both are lawyers. They start a personal injury law firm. Over the course of six months
dlinn [17]

Answer:

<h2>They are bankrupt.</h2>

Explanation:

Bankrupt is a stage given by a legal court, that is legally assigned when they are able to demonstrate that they can't pay the debts. So, the court could order the relief of their debts or part.

7 0
3 years ago
How does immigration not lead to poverty?
Ira Lisetskai [31]

Answer:

Poverty rates and median family income

Indeed, the poverty rate of recent immigrants is more than twice that of U.S. natives. Because of this, at any point in time, the poverty rate would most certainly be lower in the absence of immigration. Also, increasing the immigrant share will raise the poverty rate.

Explanation:

have a great day

7 0
2 years ago
On January 1, Year 1, Parker Company purchased an asset costing $20,000. The asset had an expected five-year life and a $2,000 s
SOVA2 [1]

Answer:

3600

7200

Explanation:

3 0
3 years ago
Other questions:
  • Who among the following is associated with contributions to quality control in operations​ management? A. Henry Ford B. W. Edwar
    6·1 answer
  • Market failure associated with public goods Deborah was willing to contribute $40 this year to her local college radio station.
    7·1 answer
  • Which principle of design is used to make one element of a design stand out?
    14·2 answers
  • Assume that Clampett, Inc., has $200,000 of sales, $150,000 of cost of goods sold, $60,000 of interest income, and $40,000 of di
    15·1 answer
  • What is a major benefit sales people offer to their businesses?
    15·1 answer
  • Spin Cycle Architecture uses three activity pools to apply overhead to its projects. Each activity has a cost driver used to all
    9·1 answer
  • PLLZZ HELLLP DUE IN 1 MINNNN
    7·2 answers
  • Which of the following management orientations holds that each country in a global marketplace is unique?
    6·1 answer
  • Shareholders in a management company have all of the following rights except the right to vote: a to change the investment objec
    7·1 answer
  • unearned revenue, an operating liability, arises when a company receives cash before any goods are delivered or services are ren
    12·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!