After-Tax Cost of Debt and Maturity
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The cost of debt: Beckham Corporation has semiannual bonds outstanding with 13 years to maturity and are currently priced at $746.16. If the bonds have a coupon rate of 8.5 percent, then what is the after-tax cost of debt for Beckham if its marginal tax rate is 35%? Assume that your calculation is made as on Wall Street.
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Solution Summary
The solution determines what is the after-tax cost of debt for Beckham if its marginal tax rate is 35%.
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