Taxable income must be interest expense

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Reference no: EM132071437

Does anyone will be able to help me step by step. Byron Books Inc. recently reported $3 million of net income. Its EBIT was $7.2 million, and its tax rate was 40%. What was its interest expense? [Hint: Write out the headings for an income statement, and then fill in the known values. Then divide $3 million of net income by (1 - T) = 0.6 to find the pretax income. The difference between EBIT and taxable income must be interest expense. Use this same procedure to complete similar problems.] Write out your answer completely. For example, 25 million should be entered as 25,000,000. Round your answer to the nearest dollar, if necessary. Do not round intermediate calculations.

Reference no: EM132071437

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