Cost of Debt Calculator

Calculate the pre-tax and after-tax cost of debt using multiple methods for WACC calculation.

Method 1: Effective Interest Rate

Annual Interest Expense ($)

Total Debt Outstanding ($)

Corporate Tax Rate (%)

Risk-Free Rate (%)

Credit Rating

Credit Spread (%)

Bond Price ($)

Coupon Rate (%)

Years to Maturity

Face Value ($)

4.50%

Pre-Tax: 6.00%

Synthetic Rating Method6.00%

Tax Rate25.0%

Interest Tax Shield1.50%

After-Tax Kd = Pre-Tax Kd × (1 - Tax Rate)

= 6.00% × (1 - 25%)

= 4.50%