Increase or decrease in the annual flotation cost tax


The amortization of flotation costs reduces taxes and thus provides an annual cash flow. What will the net increase or decrease in the annual flotation cost tax savings be if refunding takes place?

a. $6,480

b. $7,200

c. $8,000

d. $8,800

e. $9,680

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Business Management: Increase or decrease in the annual flotation cost tax
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