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Forums › ACCA Forums › ACCA FM Financial Management Forums › Calculation of cost of debt (Bond)
I have question about the calculation of bond (kd):
The first way we take Coupon * (1-Tax) to be included in cash flow and then apply IRR method. The result will after-tax cost of debt (as ACCA answer)
The second way we just inlcude Coupon and the apply method to derive the kd. This kd will be multiplied with (1-Tax) to calculate after-tax cost of debt
Thank you so muc
You must ask in the Ask the Tutor Forum if you want me to answer – this forum is for students to help each other.
(Although it would appear that you are not watching my free lectures, because I do explain this in detail in the lectures 🙂 )