Posted: February 5th, 2019
Strayer FIN100 week 6 Lab Assignment 5: Chapters 11 and 12
1.
value:
5.00 points
Oberon,
Inc., has a $10 million (face value) 8-year bond issue selling for 96 percent
of par that pays an annual coupon of 8.00 percent.
What
would be Oberonâs before-tax component cost of debt? (Round your answer to 2 decimal places.)
2.
value:
5.00 points
Suppose
you sell a fixed asset for $128,000 when its book value is $148,000. If your
companyâs marginal tax rate is 35 percent, what will be the effect on cash
flows of this sale (i.e., what will be the after-tax cash flow of this sale)?
ATCF
$
3.
value:
5.00 points
Diddy
Corp. stock has a beta of 1.4, the current risk-free rate is 5 percent, and
the expected return on the market is 14.00 percent.
What is
Diddyâs cost of equity?
4.
value:
5.00 points
Your
company is considering a new project that will require $912,000 of new
equipment at the start of the project. The equipment will have a depreciable
life of 10 years and will be depreciated to a book value of $142,000 using
straight-line depreciation. The cost of capital is 13 percent, and the firmâs
tax rate is 34 percent.
Estimate
the present value of the tax benefits from depreciation. (Round your answer to 2 decimal places.)
Present
value