3 years ago

What is the advantage of calculating the cost of debt after taxes?

History

1 answer:

spayn [35]3 years ago

6 0

Answer:

the cost of debt reduces when calculated after taxes.

Debt is one of ways of financing and refers to the quantum of loans taken by a company at an agreed interest rate for a specified period of time. Loans require the borrower to pay interest at specified intervals.

The total interest paid on debt is a tax-deductible expense, and reduces the amount of taxable income on which tax is charged.

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