Question
Pelamed Pharmaceuticals has EBIT of $340 million in 2012. In addition, Pelamed has interest expenses of $88 million and a corporate tax rate of 40%.
Pelamed Pharmaceuticals has EBIT of $340 million in 2012. In addition, Pelamed has interest expenses of $88 million and a corporate tax rate of 40%.
a. What is Pelamed's 2012 net income?
b. What is the total of Pelamed's 2012 net income plus interest payments?
c. If Pelamed had no interest expenses, what would its 2012 net income be? How does it compare to your answer in part (b)?
d. What is the amount of Pelamed's interest tax shield in 2012?
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Shape Up Your Finances The Personal Finances Handbook
Authors: Ian Birt
1st Edition
0734608268, 978-0734608260
