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   Additional After Cost Debt Tax Resources

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After-Tax Cost of Debt Capital = The Yield-to-Maturity on long-term debt x (1 minus the marginal tax rate)
 

After-tax Cost of Debt. After-tax cost of debt = Interest rate x (1 - tax rate) EXAMPLE: 0.08 = 10% x (1 - 0.2)
 

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After-Tax Cost of Debt kd(1 - T) kd - before-tax cost of debt (interest rate on debt) T - company's marginal tax rate...
 

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