The cost of debt capital is the cost that companies need to pay to raise funds by borrowing and issuing bonds. Specifically, the cost of debt capital includes the following items:

Loan interest: the interest that a company needs to pay to raise funds by borrowing. According to the loan term and interest rate, the loan interest will be different.

Bond interest: the interest that a company needs to pay to raise funds by issuing bonds. Bond interest is usually calculated according to the face value of the bond and the interest rate.

Handling fee: the handling fee that the company needs to pay to the intermediary when issuing bonds or borrowing money. The handling fee is usually determined according to the size and complexity of the bond or loan.

Commitment fee: When a company issues bonds or loans, it needs to pay the commitment fee if certain commitment terms are agreed. Commitment fees are usually calculated according to the commitment terms and duration of bonds or loans.

Sinking fund fee: In order to ensure the timely repayment of the debt principal, the company will set up a sinking fund. The cost of sinking fund is usually calculated according to the scale and operation of sinking fund.

Risk of interest rate change: When a company finances through debt, it needs to bear the risk of interest rate change. If the market interest rate rises, the company's debt cost will also rise accordingly.

Tax cost: When a company raises funds through debt, it needs to consider the tax cost. For example, if a company borrows money, it may need to pay tax costs such as withholding income tax.

Generally speaking, the cost of debt capital is one of the important costs that companies need to pay to raise funds. When making financial decisions, companies need to comprehensively consider various debt capital costs and other related factors in order to choose the most appropriate financing method and formulate the optimal capital structure.