Pelamed Pharmaceuticals has EBIT of $133 million in 2006. In addition, Pelamed has interest expenses of $49
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Pelamed Pharmaceuticals has EBIT of $133 million in 2006. In addition, Pelamed has interest expenses of $49 million and a corporate tax rate of 35%.
a. What is Pelamed’s 2006 net income?
b. What is the total of Pelamed’s 2006 net income and interest payments?
c. If Pelamed had no interest expenses, what would its 2006 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 2006?
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Related Book For
Corporate Finance The Core
ISBN: 9781292158334
4th Global Edition
Authors: Jonathan Berk, Peter DeMarzo
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