Nemo buys 80% of Dory for 250 paid with 50% debt and 50% equity. The tax rate
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Question:
Nemo buys 80% of Dory for 250 paid with 50% debt and 50% equity. The tax rate is 35%. The interest rate on new debt, issued by Nemo, is 6%. Assume the transaction closed in the first day of the fiscal year. Calculate the consolidated net income attributable to Nemo shareholders. Round your answer to 1 decimal place.
Nemo Sales 2,000.00
COGS 890
Gross profit 1,110.00
SG&A 750
Operating profit 360
Interest expense 6
Profit before tax 354
Tax expense 124
Net income 230
Dory Sales 700
COGS 315
Gross profit 385
SG&A 277
Operating profit 108
Interest expense 1
Profit before tax 107
Tax expense 37
Net income 70
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