What is heusers after-tax cost of debt


Problem:

The Heuser Company's currently outstanding bonds have a 10 percent coupon and a 12 percent yield to maturity. Heuser believes it could issue new bonds at par that would provide a similar yield to maturity. If its marginal tax rate is 35 percent, what is Heuser's after-tax cost of debt (please show all calculations)?

Solution Preview :

Prepared by a verified Expert
Finance Basics: What is heusers after-tax cost of debt
Reference No:- TGS02056953

Now Priced at $20 (50% Discount)

Recommended (91%)

Rated (4.3/5)