Pelamed Pharmaceuticals has EBIT of $133 million in 2006. In addition, Pelamed has interest expenses of $49
Question:
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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Given information EBIT 133 million Interest expense 49 million Corporate tax rate 35 a Calculate Pel...View the full answer
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Corporate Finance The Core
ISBN: 9781292158334
4th Global Edition
Authors: Jonathan Berk, Peter DeMarzo
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