Jason is the CFO of JD's, Inc. which makes exotic golf clubs. The firm has $5,000,000...
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Jason is the CFO of JD's, Inc. which makes exotic golf clubs. The firm has $5,000,000 in current assets, of which 20% are permanent, and $12,000,000 in fixed assets. Long-term interest rates are 9.50%, while short-term interest rates are 7.00%. JD's earnings before interest and taxes are $6,000,000 and its tax rate is 30%. Using the maturity-matching principle, what is JD's net income? Jason is the CFO of JD's, Inc. which makes exotic golf clubs. The firm has $5,000,000 in current assets, of which 20% are permanent, and $12,000,000 in fixed assets. Long-term interest rates are 9.50%, while short-term interest rates are 7.00%. JD's earnings before interest and taxes are $6,000,000 and its tax rate is 30%. Using the maturity-matching principle, what is JD's net income?
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To find JDs net income using the maturitymatching principle we need to calculate the interest expens... View the full answer
Related Book For
Forensic Accounting and Fraud Examination
ISBN: 978-0078136665
2nd edition
Authors: William Hopwood, george young, Jay Leiner
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