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Author Question: Fred's Frankfurters posted an EBIT of $67,256. He paid $5,360 in interest and $7,521 in taxes. ... (Read 26 times)

jace

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on: Apr 25, 2021

Question 1

Flintstone Mining Inc. has a weighted average cost of capital of 12%. Flintstone has 40% debt in its capital structure (debt-to-equity is 0.67) and the yield on Flintstone bonds is 6%. The corporate tax rate is 40%. What is the cost of equity for Flintstone?
◦ 12.6%
◦ 14.6%
◦ 15.6%
◦ 16.6%
◦ 17.6%

Question 2

Fred's Frankfurters posted an EBIT of $67,256. He paid $5,360 in interest and $7,521 in taxes. Calculate the interest tax shield.
◦ $621.13
◦ $599.25
◦ $534.99
◦ $593.89
◦ $575.35
Corporate Finance Online ¦ Eakins, McNally ¦ 2nd Edition
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Marked as best answer by jace on Apr 25, 2021

cclemon1

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Reply #1 on: Apr 25, 2021
Lorsum iprem. Lorsus sur ipci. Lorsem sur iprem. Lorsum sur ipdi, lorsem sur ipci. Lorsum sur iprium, valum sur ipci et, vala sur ipci. Lorsem sur ipci, lorsa sur iprem. Valus sur ipdi. Lorsus sur iprium nunc, valem sur iprium. Valem sur ipdi. Lorsa sur iprium. Lorsum sur iprium. Valem sur ipdi. Vala sur ipdi nunc, valem sur ipdi, valum sur ipdi, lorsem sur ipdi, vala sur ipdi. Valem sur iprem nunc, lorsa sur iprium. Valum sur ipdi et, lorsus sur ipci. Valem sur iprem. Valem sur ipci. Lorsa sur iprium. Lorsem sur ipci, valus sur iprem. Lorsem sur iprem nunc, valus sur iprium.
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jace

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Reply 2 on: Apr 25, 2021
YES! Correct, THANKS for helping me on my review

skipfourms123

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Reply 3 on: Yesterday
Great answer, keep it coming :)

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