The company's 5% coupon rate with semiannual payments, $1,000 par value bond, maturing in 30 ye ars is selling for $931 95 Company's far rate is 30% What is the component cost of debt for the purpose of calculating WACC? Select one a. Not enough information Ob382% Od1.91%
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- Part AUsing the following free cash flows and cost of equity = 7%, discount FCF year 1 back to time 0 (today). FCF year 1 = 500; FCF year 2 = 520; FCF year 3 = 560; FCF year 4 = 590; FCF year 5 = 610 a) 429.36 b) 467.29 c) 512.85 d) 422.10Part B Using the following expected interest payments, cost of debt = 5%, and tax-rate = 21%, discount the year 4 expected payment back to time 0 (today). Expected interest year 1 = 50; year 2 = 35; year 3 = 20; year 4 = 10; 5 = 0 a) 9.31 b) 10.11 c) 13.65 d) 6.50Consider the following balance sheet Expected Balance Sheet for XYZ Bank Assets Yield Liabilities Cost Rate sensitive $ 1300 8% %$4 1700 8% Fixed rate $500 9% $1500 5% Non earning $ 5100 $. 1800 Equity 1900 Total $ 6900 $6900 What is the Net Interest Margin (NIM)Cost of debt with fees Kenny Enterprises will issue a bond with a par value of $1,000, a maturity of twenty years, and a coupon rate of 10 4% with semiannual payments, and will use an investment bank that charges $20 per bond for its services. What is the cost of debt for Kenny Enterprises at the following market prices? a. $980.40 b. $994 65 c. $1,066 78 d. $1,176 66
- Please do your own work, don't copy from the internet Q5) Calculate the aftertax cost of debt under each of the following conditions: Yield Corporate Tax Rate a. 8.0% 18% b. 12.0% 34% c. 10.6% 15% Solution: Kd = Yield (1 – T) Yield (1 – T) Yield (1 – T) 8.0% (1 – .18) 12.0% (1 – .34)Calculate the aftertax cost of debt under each of the following conditions. (Do not round intermediate calculations. Input your answers as a percent rounded to 2 decimal places.) raw C. Yield 8.0% 8.6 % 6.5 % Corporate Tax Rate 22 % 25 % Aftertax Cost of Debt % % %Do Question 22 Rank XYZ ha the illwg kvie hlance sheet tenpeed s of doll Assets Liabilities 5-year Short-term Loans 750 950 CDs Net Long-term Loans 250 50 Worth The short-tems loans are zero coupon and repaid at the end of 1 year. The Long-term loans are zero coupon loans that mature in 5 years. On the liability side, the 5-year CDs are also zero coupon. Assume that the yield curve is flat and interest rates are 10% today. Suppose you want to duration hedge the bank's equity by buying a 6-year Treasury STRIP financed with overnight borrowing in the interbank market. How would you hedge against a 1% increase in interest rates using STRIPS? O Short 458 million O Long 458 million O Long 500 million O Short 500 million O Long 550 million
- Cost of debt with fees Kenny Enterprises will issue a bond with a par value of $1,000, a maturity of twenty years, and a coupon rate of 9.6% with semiannual payments, and will use an investment bank that charges $20 per bond for its services. What is the cost of debt for Kenny Enterprises at the following market prices? a. $959.56 b. $992.39 c. $1,060.96 d. $1,144.77 ACCES a. What is the cost of debt for Kenny Enterprises at a market price of $959.56? % (Round to two decimal places.)ou Answered rrect Answer The Crystal Center has issued bonds that will pay $42 one year from today. Then going forward this amount will increase by 3.8% each year forever. If these bonds are selling for $846, what is the discount rate for the bonds? (Please enter your answer as a whole number to two decimal places. i.e. 2.25, not 0.0225) 22,263.16 8.76 margin of error +/-0.01The following bond was quoted in The Wall Street Journal: Net change close 100.875% Current yield Volume Bonds NJ 4.125% 35 1.7% +1.0625% Five bonds were purchased yesterday, and 5 bonds were purchased today. How much more did the 5 bonds cost today? (Do not round intermediate calculations. Round your answer to the nearest cent.) Increased cost < Prev 18 of 18 Next ...**. M
- K The outstanding debt of Berstin Corp. has eight years to maturity, a current yield of 9%, and a price of $80. What is the pretax cost of debt if the tax rate is 30%. A. 7.5% B. 10.8 % OC. 6.5 % OD. more information neededXYZ Bank has the following Balance sheet: K’M K’million Cash 20 Demand Deposits 100 15-yr, 10% Loan 160 5-yr, 6% CD Balloon 210 30-yr, 8% Bond 300 20-yr, 7% Debenture 120 Total Assets 480 Equity 50 Total Liabilities and Equity. 480 What is the Maturity Gap?Cost of debt with fees. Kenny Enterprises will issue a bond with a par value of $1,000, a maturity of twenty years, and a coupon rate of 10.8% with semiannual payments, and will use an investment bank that charges $30 per bond for its services. What is the cost of debt for Kenny Enterprises at the following market prices? a. $931.44 b. $1,013.16 c. $1,102.27 d. $1,152.27 ..... a. What is the cost of debt for Kenny Enterprises at a market price of $931.44? |% (Round to two decimal places.)