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Unformatted text preview: asking for the tax rate that would cause the company to prefer the Florida bond or the AT&amp;T bond. 3-10 EBIT = $750,000; DEP = $200,000; 100% Equity; T = 40% NI = ?; NCF = ?; OCF = ? First, determine net income by setting up an income statement: EBIT $750,000 Interest EBT $750,000 Taxes (40%) 300,000 NI $450,000 NCF = NI + DEP = $450,000 + $200,000 = $650,000....
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This note was uploaded on 07/13/2011 for the course FIN 4414 taught by Professor Staff during the Spring '08 term at University of Florida.
- Spring '08