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aniked [119]
3 years ago
6

Whispering Pines, a recovery center for Mountain Dew addicts, has a perpetual level of debt of $50 million and an equal amount o

f equity. Assuming the firm has a rate of debt of 7.5% and the corporate tax rate is 30%, what is the value (today) of the tax shield provided by Whispering Pines’ debt?
Business
1 answer:
ipn [44]3 years ago
7 0

Answer:

$1,125,000

Explanation:

Tax Shield is the saving of tax due some allowable deduction. In this question the cost of debt is the allowable deduction that cause the tax saving.

As per given data

Debt value = $50 million = $50,000,000

Cost of Debt = 7.5%

Interest on debt = Debt value x Cost of debt

Interest on debt = $50,000,000 x 7.5%

Interest on debt = $3,750,000

Tax shield on the interest expense = Interest expense x Tax rate

Tax shield on the interest expense = $3,750,000 x 30%

Tax shield on the interest expense = $1,125,000

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What packaging strategy is often employed by store brands? a. sub-brand packaging b. copycat packaging c. cobranding packaging d
9966 [12]

Licensed packaging, strategy is often employed by store brands.

For good reason, licensed properties are frequently used on packaging. Licensing may give brands publicity, access to new markets or areas, increased revenue, and more. However, there may also be modest to significant drawbacks.

Renée Whitworth, a strategic partner at the design firm Flood Creative in New York, spoke with BRANDPACKAGING about licensed  strategies to assist brands decide their best course of action (www.floodcreativeny.com).

In its 15 years of utilizing design as a tool for strategy, Flood has produced a fair amount of licensed packaging for businesses. Whitworth discusses the advantages and disadvantages of licensed packaging as well as smart ways to use it.

Hence, option E is correct.

To learn more about Licensed Packaging here

brainly.com/question/9507879

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7 0
2 years ago
in a split offering, a) shares are issued from the corporation and sold by existing shareholders. b) all shares are issued to th
melisa1 [442]

In a split offering, we see that a) shares are issued from the corporation and sold by existing shareholders.

<h3>What is a split offering?</h3>

A split offering is a type of stock issuance that involves the issuing of new stock and existing stock that it is in the market already. This is why it is called a split offering - one side of the offering comes from the corporation, and the other comes from the existing shareholders.

With a split offering, the seller will be existing shareholders and not the company. This means that the corporation that issues the shares, will then cooperate with existing shareholders who will then be the ones to sell the shares.

Find out more on stock offerings at brainly.com/question/13049425.

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4 0
1 year ago
At the beginning of October, Cozier Corporation had $34,000 of raw materials on hand. During the month, the company purchased an
Hitman42 [59]

Answer:

$92,000

Explanation:

As we know that the raw material inventory debited by the starting balance amount, purchase amount but it would be credited by the material used or transferred amount to the WIP inventory

As we can see that the $92,000 is requisitioned i.e. transferred to the WIP inventory so the same is to be reflected in the credit amount

Hence, the credit to the raw material account is made for $92,000

We assume that requisitioned word is used instead of removal

6 0
3 years ago
Which famous coin was kniwn as original dollar​
Ede4ka [16]

Answer:

Sacagawea Dollar

Explanation:

The famous coin was known as Sacagawea

4 0
4 years ago
If a family's income does not increase as fast as the prices of the goods and services that it consumes, its standard of living
Vinil7 [7]

Answer:

Inflation lowers the standard of living for people whose income does not increase as fast as the price level. Real GDP measures the: value of final goods and services produced within the borders of a country, corrected for price changes.

5 0
3 years ago
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