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Colter Steel has $4,650,000 in assets. Temporary current assets $ 1,300,000 Permanent current assets 1,515,000 Fixed assets 1,835,000 Total assets $ 4,650,000 Assume short-term interest
Colter Steel has $4,650,000 in assets. Temporary current assets $ 1,300,000 Permanent current assets 1,515,000 Fixed assets 1,835,000 Total assets $ 4,650,000 Assume short-term interest rates are 10 percent and long-term rates are 4 percentage points lower than short-term rates. Earnings before interest and taxes are $990,000. The tax rate is 40 percent. If long-term financing is perfectly matched (synchronized) with long-term asset needs, and the same is true of short-term financing, what will earnings after taxes be
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