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Problem:

Laiho Industries reported following information in its annual report:

• Net income = $7.0 million.

• NOPAT = $60 million.

• EBITDA = $120 million.

• Net profit margin = 5.0%.

Laiho has depreciation expenditure, but no amortization expenditure. Laiho has $300 million in operating capital, its after-tax cost of the capital is 10%, and the firm’s tax rate is the 40%.What is Laiho’s depreciation expenditure show your computation?

a. $20.0 million

b. $30.0 million

c. $53.0 million

d. $60.0 million

e. $77.1 million

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M910701

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