XYZ Electronics has $350,000 in assets and earnings before interest and taxes (EBIT) of $75,000 for the fiscal year. The company has a marginal tax rate of 35% and pays interest of 10% on all debt. If the company maintains a 45% debt/assets ratio, what is its net income after taxes and interest?

XYZ Electronics has $350,000 in assets and earnings before interest and taxes (EBIT) of $75,000 for the fiscal year. The company has a marginal tax rate of 35% and pays interest of 10% on all debt. If the company maintains a 45% debt/assets ratio, what is its net income after taxes and interest?

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter7: Analysis Of Financial Statements

Section: Chapter Questions

Problem 2P: Vigo Vacations has $200 million in total assets, $5 million in notes payable, and $25 million in...

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What is the true answer? general Accounting

XYZ Electronics has $350,000 in assets and earnings before interest and
taxes (EBIT) of $75,000 for the fiscal year. The company has a marginal
tax rate of 35% and pays interest of 10% on all debt. If the company
maintains a 45% debt/assets ratio, what is its net income after taxes and
interest?

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