Lyme Home has 5,000 bonds outstanding with a face value of $1,000 each and a coupon rate of 7.65 percent. Interest is paid semiannually. What is the amount of the annual tax shield on debt if the tax rate is 23 percent

Answers

Answer 1
Answer:

if the tax rate is 23%, the amount of the annual tax shield on debt will be $87,975.

Total Interest = Total Bonds * Face Value * Coupon Rate

Total Interest = (5,000 bonds*$ 1,000) * 7.65%

Total Interest = $5,000,000 * 7.65%

Total Interest = $ 382,500

Annual Tax Shield =Total Interest * Tax Rate

Annual Tax Shield = $382,500*23%

Annual Tax Shield = $87,975

In conclusion, if the tax rate is 23%, the amount of the annual tax shield on debt is $87,975.

Read more about Annual Tax Shield

brainly.com/question/7549569


Related Questions

If we accept "consumer satisfaction" as the objective of our macro-marketing system, this means that: consumer educators should choose what products should be produced. "home economists" will be the best judges of what should be produced. each consumer should decide how best to satisfy his or her own wants. not every consumer should be allowed to decide his or her own wants. government planners should choose the kinds of products to be produced.
Activities of a central motor pool that provides and services vehicles for the use of municipal employees on official business should be accounted for in a. General Fund. b. Enterprise Fund. c. Internal Service Fund. d. Special Revenue Fund.
A labor contract provides for a first-year wage of $10 per hour, and specifies that the real wage will rise by 3 percent in the second year of the contract. The CPI is 1.00 in the first year and 1.07 in the second year. What dollar wage must be paid in the second year?
Select True or False for each of the following statements about ID requirements.True FalseYou are required to request and obtain a valid form of photo identification from a customer at the beginning of thetransaction or when prompted by the register.If a customer tries to avoid giving you their ID, you can still go through with the transaction.You must not accept a post office box as a physical address when processing a financial service transaction.Submit >
30-year maturity bond with face value of $1,000 makes semiannual coupon payments and has a coupon rate of 8%. (Do not round intermediate calculations. Enter your answers as a percent rounded to 3 decimal places.) a. What is the yield to maturity if the bond is selling for $900?

Samantha was in the final stages of selling her existing business, but she backed out of the deal at the last minute because the buyer asked her to sign a contract stating that she would not enter into a similar business within the state for at least 15 years. This is an example of ______.

Answers

Answer:

An unreasonable noncompete clause

Explanation:

A noncompete clause is any provision of a contract that ensures that one party will not compete directly with the other party by starting a similar business or profession that generates competition between them. In the question, there was an example of An unreasonable noncompete clause, which is any clause provided for in a contract that goes beyond the limitations determined to be legally binding, such as the time period and geographic area where an individual cannot to compete.

On January 1, a store had inventory of $48,000. January purchases were $46,000 and January sales were $90,000. On February 1 a fire destroyed most of the inventory. The rate of gross profit was 25% of cost. Merchandise with a selling price of $7,500 remained undamaged after the fire. Compute the amount of the fire loss, assuming the store had no insurance coverage. Label all figures.

Answers

Answer:

the amount of the fire loss is $16,000

Explanation:

The computation of the amount of the fire loss is shown below

January 1 inventory $48,000

Add purchases $46,000

Goods Available $94,000

Less Cost of Goods Sold ($90,000 × 100 ÷ 125) $72,000

Less Cost of undamaged goods ($7,500 × 100 ÷ 125) $6,000

Goods Lost by Fire $16,000

hence, the amount of the fire loss is $16,000

(ANSWER QUICK) Which of the following is an accurate statement about charitable giving (philanthropy) in the United States?

Answers

Philanthropy has a long history in the US.

Use the following classification to determine which category each of the following goods falls into. Goods Private Good Club Good Common Resource Public Good Museums that require admission fees Public swimming pools with free admission during summer Metered parking at a municipal parking lot Flood control Public basketball courts

Answers

Answer:

swimming pool is public good. basketball court public good. museums with admission fee are club good, metered parking public good. flood control public good

Explanation:

A government collects $600 billion annually in tax revenue. Each year it allocates $35 billion to healthcare and $50 billion for education. What percentage of annual tax revenue is allocated to these two categories of government spending?

Answers

Answer:

14.17%

Explanation:

Annual tax revenue = $600 billion

Allocation for healthcare = $35 billion

Allocation for education = $50 billion

total allocation for healthcare and education = ($35 + $50) billion = $85 billion

percentage of these two categories of government spending to the total revenue generated is,

85/600 x 100% = 14.17%

The government allocates approximately 14.17% of its annual tax revenue to healthcare and education. This is calculated by dividing the sum of allocations to healthcare and education by the total tax revenue and then multiplying by 100 to convert that to a percentage.

To calculate the percentage of tax revenue allocated to healthcare and education by the government, we first need to add the amounts allocated to each of these sectors. In this case, $35 billion for healthcare plus $50 billion for education makes a total of $85 billion. Then, we divide this sum by the total revenue, which is $600 billion, and multiply the result by 100 to get the percentage.

So, the calculation will look like this:

(($85 billion / $600 billion) * 100) = 14.167%.

Therefore, the government allocates approximately 14.17% of its annual tax revenue to healthcare and education.

Learn more about Percentage Calculations here:

brainly.com/question/329987

#SPJ3

One year ago, you purchased 350 shares of Titan Wood Products for $63.17 per share. The stock has paid dividends of $.71 per share over the past year and is currently priced at $68.22. What is your total dollar return on your investment?a. $2016.00b. $1891.75c. $1767.50d. $2083.20e. $1008.00

Answers

Answer:

gfshjddjssx jvskjkjbggdaz ffddcb

Other Questions