The Globe Incorporated Has EBIT of $30 Million for the Current

question 94

Multiple Choice

The Globe Incorporated has EBIT of $30 million for the current year.On the firm balance sheet,there is $90 million of debt outstanding that carries a coupon rate of 9 percent.Investors seek a return of 12 percent on the firm,and the firm has a corporate tax rate of 40%.What is the value of the firm?

• A) $152,000,000
• B) $160,000,000
• C) $174,000,000
• D) $186,000,000

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