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Haricot Corporation and Pinto Corporation both have operating profits of $ 1 5 5 million. Haricot is financed solely by equity, while Pinto has issued

Haricot Corporation and Pinto Corporation both have operating profits of $

155

million. Haricot is financed solely by equity, while Pinto has issued $

205

million of

5 %

debt. If the corporate tax rate is

21 %

:Required:How much tax does each company pay?What is the total payout to investors

(

debtholders plus shareholders

)

of each company?

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