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Cost of debt

Sstacie39511y ago
Hi sir, 'Ferlandis Plc raised $1,000,000 by the issue at par of 7% irredeemable loan stock, interest on which is payable yearly in arrears'. If nothing is mentioned in the question, should we assume the 7% to be before or after tax...? Thanks...~
John MoffatJohn MoffatTutor11y ago#1
The 7% (coupon rate) will always be before tax.
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