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Colter Steel has $5,450,000 in assets. Temporary current assets $ 2,900,000 Permanent current assets 1,595,000 Fixed assets 955,000 Total assets $ 5,450,000 Short-term rates are
Colter Steel has $5,450,000 in assets. Temporary current assets $ 2,900,000 Permanent current assets 1,595,000 Fixed assets 955,000 Total assets $ 5,450,000 Short-term rates are 7 percent. Long-term rates are 12 percent. Earnings before interest and taxes are $1,150,000. The tax rate is 20 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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