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Kaylis [27]
3 years ago
14

Outstanding debt of Home Depot trades with a yield to maturity of ​%. The tax rate of Home Depot is . What is the effective cost

of debt of Home​ Depot?
Business
1 answer:
nydimaria [60]3 years ago
8 0

Answer:

5.6%

Explanation:

A lot of information is missing, so I looked for similar questions to fill in the blanks:

"Outstanding debt of Home Depot trades with a yield to maturity of 8%.

The tax rate of Home Depot is 30%.

What is the effective cost of debt of Home Depot?"

the effective cost of debt or after tax cost of debt = debt's yield to maturity x (1 - tax rate) = 8% x (1 - 30%) = 8% x 0.7 = 5.6%

Interest is tax deductible, therefore, it creates a tax shield that lowers net interest expense.

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8 0
3 years ago
For which of the following businesses would the job order cost system be appropriate? a.oil refinery b.canned soup processor c.l
attashe74 [19]

Answer:

The correct answer is letter "C": lumber mill.

Explanation:

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4 0
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Why do I have to pay
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Answer:

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Explanation:

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4 0
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Read 2 more answers
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