Cool refreshments has bonds outstanding with a face value


Question: Cool Refreshments has bonds outstanding with a face value of $140,000 that are selling at par. It also has 15,000 shares of stock outstanding that are selling for $19.80 a share. The all-equity value of the firm is $395,000. The tax rate is 34 percent. What is the value of the financial distress costs? Assume there are no other claims on the firm.

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Finance Basics: Cool refreshments has bonds outstanding with a face value
Reference No:- TGS02756558

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