NPV – Debentures (Chapter 6, Example 10)

Hi John,

The question states “Debt – $6M 10% debentures quoted at 105 ex int.”. Should we not use the total value of the debentures (i.e. $6m x 1.05 = $6.3m) as the initial cash inflow from the issuance, and also for the cash outflows for the 6 years coupon payments at PV (i.e. $6m x 10% x (1 – 30%) x 4.355 = $1.83m)? Or we can just use the unit trading price of the debenture (i.e. $105)?

Many thanks.

Best regards,
Kenny