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A firm incurs $70,000 in interest expenses each year. If the tax rate of the firm is 30%, what is the effective after-tax interest rate expense for the firm?
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A firm incurs $70,000 in interest expenses each year. If the tax rate of the firm is 30%, what is the effective after-tax interest rate expense for the firm?

User Timfreilly
by
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1 Answer

1 vote

Answer:

After tax interest expenses = Interest expenses x (100 - Tax Rate)

= 70000 x (100 - 30)%

= 70000 x 70%

= $49,000.00

Explanation:

User Medel
by
8.7k points
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