Assuming that Ideko's market share after 2005 will increase each year, the required production volume for the following five years are shown below: Sales Data Growth/Year 2005 2006 2007 2008 2009 2010 Market Size (000 units) 5.10% 9,800.0 10,299.8 10,825.1 11,377.2 11,957.4 12,567.2 Market Share 0.45% 10.30% 10.75% 11.20% 11.65% 12.10% 12.55% Production Volume (000 units) 1,009.4 1,107.2 1,212.4 1,325.4 1,446.8 1,577.2 Ideko's production plant will require an expansion in 20102010 (when production volume will exceed the current level by 50 %50%), and the cost of this expansion will be $ 15.8$15.8 million. Assuming the financing of the expansion will be delayed accordingly, calculate the projected interest payments and the amount of the projected interest tax shields (assuming that the interest rates on the term loans is 6.8 %6.8%) through 20102010. Consider an income tax rate of 35 %35%. Ideko's balance sheet for 2005 is shown here.

Debt and intrest ($ 000)

2005

2006

2007

2008

2009

2010

Debt Interest on Term Loan 6.8% Interest Tax Shield