Question
Husky Enterprises recently sold an issue of 8-year maturity bonds. The bonds were sold at a...
Husky Enterprises recently sold an issue of 8-year maturity bonds. The bonds were sold at a deep discount price of $650 each. After flotation costs, Husky received $612 each. The bonds have a $1,000 maturity value and pay $30 interest at the end of each year. Compute the after-tax cost of debt for these bonds if Husky’s marginal tax rate is 40 percent. Round your answer to two decimal places. 10.12% would be entered as 10.12.
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Answer #1
As nothing was mentioned excel is used.
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