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Toms Kitchen has a $200,000 annual-coupon bond issue outstanding. The bond has a 6 percent coupon rate. The corporate tax rate is 35 percent. What
Toms Kitchen has a $200,000 annual-coupon bond issue outstanding. The bond has a 6 percent coupon rate. The corporate tax rate is 35 percent. What is the amount of the annual interest tax shield?
| A. | $1,500 | |
| B. | $2,100 | |
| C. | $3,500 | |
| D. | $4,200 | |
| E. | $4,900 |
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