If annual lease payments for a firm are $26,000, calculate the annual tax shield of these payments, given that the marginal tax rate is 21 percent.

Name: If annual lease payments for a firm are $26,000, calculate the annual tax shield of these payments, given that the marginal tax rate is 21 percent.
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Quizplus · Accepted Answer

The tax shield is calculated as the lease payment multiplied by the marginal tax rate. Therefore, the annual tax shield is 26,000 x 0.21 = $5,460.

If Annual Lease Payments for a Firm Are $26,000, Calculate