A firm pays the bank 7% on its loan but is in a high tax bracket of 40%. What is the right cost of debt that managers should use in deciding how costly debt financing is? Group of answer choices 7% 2.8% 4.2% 5.6%

1) Goofy Gas Works has bonds that mature in 10 years

The bonds have a 10% coupon rate paid quarterly.

They have a before tax cost of debt of 8% and a tax bracket of 35%

What is the cost of debt? Answer should be 5.2%, need work to justify all answers.

2) Wild Child Motors has a 12 year bond that carries an 8% semi-annual coupon rate and a nominal yield to maturity of 6%. The firm incurs flotation costs of 3% of the price of the bond. What is the cost of the debt if the firm is in the 40% tax bracket? answer should be 3.83%

3) Jolly Jelly bean Co. has a bond with a 12 year maturity date and a 9% Semi-annual coupon rate.The bond had a Nominal yield to maturity of 7%. The firm would pay $3 flotation cost. What is the bonds cost of debt if the firm is in the 35% tax bracket? answer should be 4.58%

Please help with all 3 problems!!!!

A firm with earnings before interest and taxes of $500,000 needs $1 million of additional funds. If it issues debt, the bonds will mature after 20 years and pay interest of 8 percent. The firm could issue preferred stock with a dividend rate of 8 percent. The firm has 100,000 shares of common stock outstanding and is in the 30 percent tax bracket. What are the (1) earnings per common share under the two alternatives, (2) the times-interest-earned if the firm uses debt financing, and (3) the times-dividend-earned if the firm uses preferred stock financing?

What are the two most important decisions of financial managers? Briefly describe them. AND write what the objective of managers should be? (4 sentences)