The bonds are selling at 975 of face value the companys tax


Jimmy's Hockey Pucks has 180,000 shares of common stock outstanding at a market price of $33 a share. Last month Jummy's paid an annual divident in ther amount of $1.53 per share. The dividend growth rate is 3.4%. Jake's also has 6,000 bonds outstanding with a face value of $1,000 per bond. The bonds carry 7.25% coupon, pay interest annually, and mature in 5.40 years. The bonds are selling at 97.5% of face value. The company's tax rate is 33%. What is Jake's weighted average cost of question.

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Finance Basics: The bonds are selling at 975 of face value the companys tax
Reference No:- TGS0606136

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