Doyle Company issued $226,000 of 10-year, 5 percent bonds on January 1, Year 1. The bonds were issued at face value. Interest is payable in cash on December 31 of each year. Doyle immediately invested the proceeds from the bond issue in land. The land was leased for an annual $74,000 of cash revenue, which was collected on December 31 of each year, beginning December 31, Year 1. Required a. Prepare the journal entries for these events, and post them to T-accounts for Year 1 and Year 2. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) g

Afirm's before-tax cost of debt, rd, is the interest rate that the firm must pay on debt. because interest is tax deductible, the relevant cost of debt used to calculate a firm's wacc is the cost of debt, rd (1 – t). the cost of debt is used in calculating the wacc because we are interested in maximizing the value of the firm's stock, and the stock price depends on cash flows. it is important to emphasize that the cost of debt is the interest rate on debt, not debt because our primary concern with the cost of capital is its use in capital budgeting decisions. the rate at which the firm has borrowed in the past is because we need to know the cost of capital. for these reasons, the on outstanding debt (which reflects current market conditions) is a better measure of the cost of debt than the . the on the company's -term debt is generally used to calculate the cost of debt because more often than not, the capital is being raised to fund -term projects. quantitative problem: 5 years ago, barton industries issued 25-year noncallable, semiannual bonds with a $1,600 face value and a 8% coupon, semiannual payment ($64 payment every 6 months). the bonds currently sell for $845.87. if the firm's marginal tax rate is 40%, what is the firm's after-tax cost of debt? round your answer to 2 decimal places. do not round intermediate calcu

Hi inr 2002 class! i just uploaded a detailed study guide for this class. you can check-out a free preview by following the link below feel free to reach-out to me if you need a study buddy or have any questions. goodluck!

Microsoft's stock price peaked at 6118% of its ipo price more than 13 years after the ipo suppose that $10,000 invested in microsoft at its ipo price had been worth $600,000 (6000% of the ipo price) after exactly 13 years. what interest rate, compounded annually, does this represent? (round your answer to two decimal places.)