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help. Calvin's Catering Company is developing a plan to finance its assets. The firm has $5,000,000 in current assets ( 20% of which are permanent)
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Calvin's Catering Company is developing a plan to finance its assets. The firm has $5,000,000 in current assets ( 20% of which are permanent) and $12,000,000 in capital assets. Short-term rates are at 7%, while long-term rates are currently 9.5%. Calvin's tax rate is 30%. Calvin is considering an aggressive plan, where 60% of total assets would be financed with long-term financing. Required: If earnings before interest and taxes were $6,000,000, what are the earnings after taxes under this alternative Step by Step Solution
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