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Simple RI In 2 0 1 4 , American Faucet Corporation ( AFC ) had earnings before interest and taxes of $ 2 5 0
Simple RI
In American Faucet Corporation AFC had earnings before interest and taxes of $ million. AFC is subject to
a tax rate of percent. The book value and market value of AFC's common equity at the beginning of was
$ million and $ million, respectively. AFC's debt had a book value of $ million at the beginning and end of
and the company pays percent interest on its debt. The company's cost of equity capital is estimated to be
percent. Based on this information, AFC's residual income will be closest to:
$
million
Round your answer to two decimals
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