Blockbuster is a video rental and retail chain.Blockbuster is forecasting its financial statements for Year 3.Selected financial information for Years 1 and 2 is provided in the table.What is the interest expense for Blockbuster in Year 3? (Assume that Blockbuster's average cost of debt is 7.50%.)
Selected Financial Information
Blockbuster Inc.($ '000)

Question

Quizplus · Accepted Answer

Interest 11ea7fdb_fc47_7c7a_a768_e797459c765b_TB2902_11 = 11ea7fdb_fc47_7c7b_a768_b93b3399b688_TB2902_11 × (Short-term 11ea7fdb_fc47_7c7c_a768_39e8934e3844_TB2902_11 + Long-term 11ea7fdb_fc47_7c7d_a768_3db7f97f8265_TB2902_11 )
Interest 11ea7fdb_fc47_a38e_a768_e94ad23a3d59_TB2902_11 = 0.075 × ($162,430 + $798,300) = $72,054

Blockbuster Is a Video Rental and Retail Chain