Your firm currently has $84 million in debt outstanding with a 8% interest rate. The terms...

Your firm currently has $84 million in debt outstanding with a 8% interest rate. The terms of the loan require the firm to repay $21 million of the balance each year. Suppose that the marginal corporate tax rate is 40%, and that the interest tax shields have the same risk as the loan. What is the present value of the interest tax shields from this debt?

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jeff jeffy answered 2 years ago

Your firm currently has $116 million in debt outstanding with a 9% interest rate. The terms...

Your firm currently has $116 million in debt outstanding with a 9% interest rate. The terms of the loan require the firm to pay $29 million of the balance each year. Suppose that the marginal corporate tax rate is 40% and that the interest tax shields have the same risk as the loan. What is the present value of the interest shields from this debt? *****please show work*****

Your firm currently has $ 92 million in debt outstanding with a 9 % interest rate....

Your firm currently has $ 92 million in debt outstanding with a 9 % interest rate. The terms of the loan require the firm to repay $ 23 million of the balance each year. Suppose that the marginal corporate tax rate is 40 %, and that the interest tax shields have the same risk as the loan. What is the present value of the interest tax shields from this debt?

Your firm currently has $ 52 million in debt outstanding with a 10 % interest rate....

Your firm currently has $ 52 million in debt outstanding with a 10 % interest rate. The terms of the loan require it to repay $ 13 million of the balance each year. Suppose the marginal corporate tax rate is 30 %，and that the interest tax shields have the same risk as the loan. What is the present value of the interest tax shields from this debt? The present value of the interest tax shields is million. (Round to two...

Your firm currently has $ 116 million in debt outstanding with a 9 % interest rate....

Your firm currently has $ 116 million in debt outstanding with a 9 % interest rate. The terms of the loan require the firm to repay $ 29 million of the balance each year. Suppose that the marginal corporate tax rate is 35 % , and that the interest tax shields have the same risk as the loan. What is the present value of the interest tax shields from this debt?

Your firm currently has $ 88$88 million in debt outstanding with a 9 %9% interest rate....

Your firm currently has $ 88$88 million in debt outstanding with a 9 %9% interest rate. The terms of the loan require the firm to repay $ 22$22 million of the balance each year. Suppose that the marginal corporate tax rate is 30 %30%, and that the interest tax shields have the same risk as the loan. What is the present value of the interest tax shields from this debt?

Your firm currently has $ 96 million in debt outstanding with a nbsp 9 % interest...

Your firm currently has $ 96 million in debt outstanding with a nbsp 9 % interest rate. The terms of the loan require it to repay $ 24 million of the balance each year. Suppose the marginal corporate tax rate is 40 %, and that the interest tax shields have the same risk as the loan. What is the present value of the interest tax shields from this debt?

Your firm currently has $ 104 million in debt outstanding with a nbsp 7 % interest...

Your firm currently has $ 104 million in debt outstanding with a nbsp 7 % interest rate. The terms of the loan require it to repay $ 26 million of the balance each year. Suppose the marginal corporate tax rate is 40 %, and that the interest tax shields have the same risk as the loan. What is the present value of the interest tax shields from this debt?

Aant Investments Inc. currently has $3.5 million in debt outstanding, bearing in interest rate of 12.3%....

Aant Investments Inc. currently has $3.5 million in debt outstanding, bearing in interest rate of 12.3%. It wishes to finance a $5 million expansion program and is considering five alternatives. Plan Debt Preferred Equity 1 0% 0% 100% 2 35% 0% 65% 3 50% 0% 50% 4 50% 20% 30% 5 60% 20% 20% The preferred stock dividend will be 12% and the price of common stock will be $18 per share. The company currently has 750,000 shares of common...

The Morrit Corporation has $720,000 of debt outstanding, and it pays an interest rate of 8%...

The Morrit Corporation has $720,000 of debt outstanding, and it pays an interest rate of 8% annually. Morrit's annual sales are $3 million, its average tax rate is 25%, and its net profit margin on sales is 3%. If the company does not maintain a TIE ratio of at least 6 to 1, then its bank will refuse to renew the loan, and bankruptcy will result. What is Morrit's TIE ratio? Do not round intermediate calculations. Round your answer to...

A company has $400 million worth of debt outstanding with an average interest rate of 5%...

A company has $400 million worth of debt outstanding with an average interest rate of 5% and 50 million common shares outstanding worth $12 each. The company’s tax rate is 34%, beta is 1.2, the yield on 10-year Treasury notes is 1.5% and the expected market return is 9.5%. What is the company’s weighted average cost of capital (WACC) based on the current weights for debt and common stock in its capital structure?

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