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Part $1$

Under the assumption that$$ KMS$\text{'}$s market share will increase by $0\mathrm{.}23\%0\mathrm{.}23\%$ per$$ year, you determine that the plant will require an expansion in $2015.$ KMS$\text{'}$s current outstanding$$ debt, the interest on the$$ debt, and the interest tax shield are given in the table below. The expansion will cost $ $20\mathrm{.}1$$$20\mathrm{.}1$ million. Assuming that the financing of the expansion will be delayed accordingly$($end of$2015),$ calculate the projected interest payments and the amount of the projected interest tax shields$($assuming that KMS still uses a$10-$year bond, interest rates remain the same at $6\mathrm{.}8\%6\mathrm{.}8\%,$ and$$ KMS$\text{'}$s tax rate is $35\%35\%)$ through $2018.$

Current values $($$$000)$

$2013$

$2014$

$2015$

$2016$

$2017$

$2018$

Outstanding debt before expansion

$ $4$ comma $468$$$4,468$

$ $4$ comma $468$$$4,468$

$ $4$ comma $468$$$4,468$

$ $4$ comma $468$$$4,468$

$ $4$ comma $468$$$4,468$

$ $4$ comma $468$$$4,468$

Interest on debt before expansion

$ $304$$$304$

$ $304$$$304$

$ $304$$$304$

$ $304$$$304$

$ $304$$$304$

$ $304$$$304$

Interest Tax Shield before expansion

$ $106$$$106$

$ $106$$$106$

$ $106$$$106$

$ $106$$$106$

$ $106$$$106$

$ $106$$$106$

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Part $1$

The total projected interest payments beginning in $2015$ will be $$$enter your response here. $($Round to the nearest$$ dollar.$)$