Eagle Sports Products (ESP) is considering issuing debt to raise funds to finance its growth during the next few years. The amount of the issue will be between $35 million and $40 million. ESP has already arranged for a local investment banker to handle the debt issue. The arrangement calls for ESP to pay flotation costs equal to 4 percent of the total market value of the issue. a. Compute the flotation costs that ESP will have to pay if the market value of the debt issue is $39 million. b. If the debt issue has a market value of $39 million, how much will ESP be able to use for its financing needs? That is, what will be the net proceeds from the issue for ESP? Assume that the only costs associated with the issue are those paid to the investment banker. c. If the company needs $39 million to finance its future growth, how much debt must ESP issue?

A company is considering to start a new product line which requires the installation of new machines and equipment. For this purpose, company wants to borrow money by issuing bonds of Php 10,000 for 12-year period. The interest on these bonds is to be paid at a rate of 8% per year. Compute the amount of interest to be paid to bondholders over 12-year period:  if the simple interest is charged.if the compounded interest is charged and the interest is compounded:(1), annually,(ii), semi-annually.(ii). quarterly (iv). Monthly   Kindly answer asap please

Please answer the following showing detailed working: Bruce & Co. expects its EBIT to be $100,000 every year forever. The firm can borrow at 11 percent. Bruce currently has no debt, and its cost of equity is 18 percent. The tax rate is 31 percent. Given the above information; a) Complete the table given below for varying levels of debt below by using a mix of the given information and using your own computations. EBIT $100,000.00       Cost of debts 11%       cost of equity when unlevered 18%       Tax rate 31%       Debts $0 $10,000.00 $20,000.00 $30,000.00 Cost of Equity when levered         Equity         D/E         Vu         VL         WACC         b) Plot the results from the table into the following two graphs:i) Value of the firm vis-à-vis- Total debtii) Cost of capital of the firm vis-à-vis D/E ratio.iii) Which MM propositions have you demonstrated?

(Related to Checkpoint 18.2) (Calculating the cost of short-term financing) The R. Morin Construction Company needs to borrow $110,000 to help finance the cost of a new $165,000 hydraulic crane used in the firm's commercial construction business. The crane will pay for itself in one year, and the firm is considering the following alternatives for financing its purchase: Alternative A. The firm's bank has agreed to lend the $110,000 at a rate of 13 percent. Interest would be discounted, and a 15 percent compensating balance would be required. However, the compensating-balance requirement is not binding on the firm because it normally maintains a minimum demand deposit (checking account) balance of $27,500 in the bank. Alternative B. The equipment dealer has agreed to finance the equipment with a 1-year loan. The $110,000 loan requires payment of principal and interest totaling $128,909. a. Which alternative should Morin select? b. If the bank's compensating-balance requirement had…