Cost of Debt. Olympic Sports has two issues of debt outstanding. One is a 9 percent coupon bond with a face

To calculate the cost of debt, we need to consider the yield or interest rate on the debt. In this case, you mentioned that Olympic Sports has two issues of debt outstanding, each with different characteristics. Let's break down the calculation for each debt issue:

Debt Issue 1: 9% Coupon Bond
This debt has a 9% coupon rate, which means that it pays 9% interest on the face value of the bond. To calculate the cost of debt for this bond, you need to find the yield to maturity (YTM) or the market interest rate at which the bond is currently being traded. If the bond is trading at par value (face value), the coupon rate and yield rate will be the same.

Formula to Calculate Cost of Debt for a Bond:
Cost of Debt = (Coupon Payment / Face Value) + ((Face Value - Market Price) / Market Price) * (1 / Years to Maturity)

In this case, you have mentioned the coupon rate as 9%, and we need information about the market price of the bond and the years remaining until maturity to calculate the exact cost of debt.

Debt Issue 2: Zero-Coupon Bond
A zero-coupon bond does not pay periodic interest like a coupon bond. Instead, it is sold at a discount from its face value and redeemed for its full face value at maturity. To calculate the cost of debt for a zero-coupon bond, you need to determine the yield to maturity or the market discount rate at which it is currently trading.

Formula to Calculate Cost of Debt for Zero-Coupon Bond:
Cost of Debt = (Face Value - Market Price) / Market Price * (1 / Years to Maturity)

In this case, you need the market price of the zero-coupon bond and the number of years remaining until maturity to calculate the exact cost of debt.

In summary, to calculate the cost of debt for each debt issue, you need the following information:
1. For the 9% coupon bond: Market price of the bond and years remaining until maturity.
2. For the zero-coupon bond: Market price of the bond and years remaining until maturity.

Once you have this information, you can plug the numbers into the respective formulas and calculate the cost of debt for each issue.