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Stock Price- $188.50
Dividend- (0.47)
Beta- 1.21
Shares Oustanding- 1.82B
Risk-Free Rate- 1.50%
Market Risk Premium- 7.00%
Market Value of Equity- $343.07B
Total Market Vlaue of Bonds - $767,441
Cost of Debt- 364.049%
Tax Rate- 35%
Question:
After Tax Cost of Debt= ?
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- Stock Price- $188.50 Dividend- (0.47) Beta- 1.21 Shares Oustanding- 1.82B Risk-Free Rate- 1.50% Market Risk Premium- 7.00% Market Value of Equity- $343.07B CAPM- 5.50% Total Market Vlaue of Bonds - $767,441 Cost of Debt- 364.049% Tax Rate- 35% Question: Cost of Equity = ? Market Value of Equity = ? Aftertax Cost of Debt = ? Market Value of Debt = ?The following data pertains to Xena Corp. Xena Corp. Total Assets $21,249 Interest-Bearing Debt (market value) $11,070 Average borrowing rate for debt 10.2% Common Equity: Book Value $5,535 Market Value $23,247 Marginal Income Tax Rate 19% Market Beta 1.64 A. Using the information from the table, and assuming that the risk-free rate is 4.5% and the market risk premium is 6.2%, calculate Xena's weighted-average cost of capital: B. Using the information from the table, determine the weight on equity capital that should be used to calculate Xena's weighted-average cost of capital.The following data pertains to Xena Corp. Xena Corp. Total Assets $21,249 Interest-Bearing Debt (market value) $11,070 Average borrowing rate for debt 10.2% Common Equity: Book Value $5,535 Market Value $23,247 Marginal Income Tax Rate 19% Market Beta 1.64 A. Using the information from the table, and assuming that the risk-free rate is 4.5% and the market risk premium is 6.2%, calculate Xena's cost of equity capital, using the capital asset pricing model: B. Using the information from the table, determine the weight on debt capital that should be used to calculate Xena's weighted-average cost of capital.
- Q1. Given, interest rate or coupon rates or dividend rate of the following - Corporate bond = 6.5% Municipal bond = 4% Preferred stock = 5% and Corporate tax rate = 45% Note - 70% of the dividends received are tax exempt . a. What is the after tax return of corporate bond, municipal bond and preferred stock? b. What will be the best choice to invest?If the cost of debt for Sohar Textiles is 8.9% (effective rate) and the after-tax cost of debt is 0.066, what is the tax rate? Select one: a. 0.258 b. 0.023 c. 1.742 d. 0.155 e. All the given choices are not corre The difference between current assets and current liabilities of a business concern is termed as Select one: a. Preferred stocks b. Loans c. None of the options d. Working capital e. BondsThe after-tax cost of debt capital is equal to the yleld to maturity on a corporate bond multiplied by (1-T). Select one: True False Previous page Next page
- 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. Round the final answers to 2 decimal places.) a b с Yield 8.5% 14.5% 12.0% Corporate tax rate 23% 37% 43% Cost of debt % % %Xena Corp. Total Assets $21,249 Interest-Bearing Debt (market value) $11,070 Average borrowing rate for debt 10.20% Common Equity: Book Value $5,535 Market Value $23,247 Marginal Income Tax Rate 19% Market Beta 1.64 Using the information from the table, and assuming that the risk-free rate is 4.5% and the market risk premium is 6.2%, calculate Xena's weighted-average cost of capital:
- EXAMPLE 5: Calculate the Return on equity from the following data. OMR Net Profit after Tax 6,00,000 10% Debentures (OMR 10 each) 10,00,000 Equity Share Capital (OMR 10 per share) 10,00,000 COMMENTSCalculate the cost of capital of a bond selling to yeild 13% for the purchaser of the bond. The borrowing firm faces a tax rate of 34% a. 8.58% b. 10.58% c. 34% d. 13.58%Archimedes Levers is financed by a mixture of debt and equity. Complete the following: (Enter your re and rA answers as a percent rounded to 2 decimal places. Round your beta answers to 2 decimal places.) E BE 11 . * 17.50% rD 0:90 SD m 4% = 6% 0.00 19 % A BA DIV . = . 12.90% 0.90 0.40