Axis Ltd is issuing 15% debentures ( face value Rs60). The net amount realized per debenture is Rs54 and they are redeemable at par after 6 years. At a corporate tax rate of 40%, what is the cost of debt?

Related MCQs

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• Face value per debenture less issue expenses equal to ---------------
• In case of Net Income Approach, when the debt proportion is increased, the cost of debt:
• The cost of debt capital if interest rate is 15% and tax rate is 40% is
• Face value is the value stated on the face of the bond and is known as-
• In MM Model with taxes, where 'r' is the interest rate, ‘D’ is the total debt and 't' is tax rate, then present valued shields would be:
• After tax cost of debt is equal to (1-t)x