Question: Firm A borrowed a 6 year, nonamortizing loan at a cost of 58%. Firm paid total flotation cost of $13,000 at the time of borrowing.

Firm A borrowed a 6 year, nonamortizing loan at a cost of 58%. Firm paid total flotation cost of $13,000 at the time of borrowing. The flotation cost will be amortized over 6 year. Corporate tax rate is 32%. What is the annual flotation cost tax shield? (DO NOT round intermediate steps, round your final answers into ONE decimal only, for example : 1.2)

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