Question
Pelamed Pharmaceuticals has EBIT of $345 million in 2006. Inaddition, Pelamed has interest expenses of $139 million and a corporate tax rate of 21%. a.
Pelamed Pharmaceuticals has EBIT of $345 million in 2006. Inaddition, Pelamed has interest expenses of $139 million and a corporate tax rate of 21%.
a. What isPelamed's 2006 netincome?
b. What is the total ofPelamed's 2006 net income plus interestpayments?
c. If Pelamed had no interestexpenses, what would its 2006 net incomebe? How does it compare to your answer in part (b)?
d. What is the amount ofPelamed's interest tax shield in2006?
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Basic Finance An Introduction to Financial Institutions, Investments and Management
Authors: Herbert B. Mayo
11th Edition
1285425790, 1285425795, 9781305464988 , 978-1285425795
