Cost of debt.

The formula for determining the cost of debt is equal to: Where: “Total Annual Interest Expense” is the total interest expense for the most recent year for all local exchange carriers with annual revenues equal to or above the indexed revenue threshold as defined in § 32.9000 of this chapter. “Average Outstanding Debt” is the average of the total debt outstanding at the beginning and at the end of the most recent year for all local exchange carriers with annual revenues equal to or above the indexed revenue threshold as defined in § 32.9000 of this chapter. [81 FR 24344, Apr. 25, 2016]