After-Tax Operating Income for a Leveraged Firm Is Defined As

question 1

Multiple Choice

After-tax operating income for a leveraged firm is defined as:

• A)net income + after-tax interest.
• B)EBIT × (1 - tax rate) + after-tax interest
• C)net income + depreciation.
• D)profit margin × sales.

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Definitions:

Interest

The cost of borrowing money, usually expressed as a percentage of the amount borrowed over a specific period of time.

Fee Simple Absolute

A type of freehold ownership where the owner has the greatest possible aggregation of rights, privileges, and power over a piece of property.

Ownership Interest

This denotes the rights and claims an individual or entity has over a property or investment.

Real Property

Land, and generally whatever is erected or growing upon or affixed to land, including buildings and crops.