What is the cost of equity-pretax cost of debt

Assignment Help Financial Management

Reference no: EM131068811

Kose, Inc., has a target debt–equity ratio of 1.25. Its WACC is 8.5 percent, and the tax rate is 38 percent. a. If Kose’s cost of equity is 12 percent, what is its pretax cost of debt? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16)) Cost of debt % b. If instead you know that the aftertax cost of debt is 3.6 percent,

What is the cost of equity? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))

Cost of equity: %

Reference no: EM131068811

Questions Cloud

Knowing the location and status of inventory and resources : Which of the following levels of supply chain information systems is most likely to provide the firm with a competitive advantage?

The board of directors using voiceover : You are the chief internal auditor of your company. Create a PowerPoint presentation to the board of directors using voiceover or provide detailed notes to your slides pertaining to any fraud topic . The presentation must be 15–20 slides (excluding c..

Calculate the debt-to-assets ratio : Assume you are given the following relationship for Haslam Corp. Sales/total Assets 2 Return on Assets 2% Return on Equity 5% 1. Calculate Haslam profit Margin. Do Not round Intermediate calculations. 2. Calculate Haslams Liabilities-to-assets-ratio...

Types of operational or security-related activities : What types of operational or security-related activities in an organization would benefit more from little or no externally-prescribed standards?

What is the cost of equity-pretax cost of debt : Kose, Inc., has a target debt–equity ratio of 1.25. Its WACC is 8.5 percent, and the tax rate is 38 percent. a. If Kose’s cost of equity is 12 percent, what is its pretax cost of debt? What is the cost of equity?

System of linear equations or system of linear inequalities : What is a real world application of either a system of linear equations or a system of linear inequalities?

What is the maximum initial cost of company : Och, Inc., is considering a project that will result in initial aftertax cash savings of $1.88 million at the end of the first year, and these savings will grow at a rate of 3 percent per year indefinitely. What is the maximum initial cost of company..

System of linear inequalities graphically : How can you solve a system of linear inequalities graphically? How many points are in the solution set? Explain your answer.

What are the advantages and disadvantages of going public : Due to your education, skills you have learned, and hard work, you have successfully managed your fledgling start-up company to the point where you are seriously considering an Initial Public Offering (IPO). What are the purpose, role, and responsibi..

User Account

All Pages