Monster Magnet Manufacturing is considering leasing some equipment. The annual lease payment would be $445,000 per...

 

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Monster Magnet Manufacturing is considering leasing some equipment. The annual lease payment would be $445,000 per year for 6 years. The appropriate interest rate is 9 percent and the company is in the 40 percent tax bracket. What reduction in debt capacity would occur if the company signs the lease? (Enter your answer in dollars, not millions of dollars, e.g., 1,234,567. Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Reduction in debt capacity Monster Magnet Manufacturing is considering leasing some equipment. The annual lease payment would be $445,000 per year for 6 years. The appropriate interest rate is 9 percent and the company is in the 40 percent tax bracket. What reduction in debt capacity would occur if the company signs the lease? (Enter your answer in dollars, not millions of dollars, e.g., 1,234,567. Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Reduction in debt capacity

Answer rating: 100% (QA)

Heres how to calculate the reduction in debt capacity for Monster Magnet Manufacturing if they lease ... View the full answer