Question: Little Books Inc. recently reported $13 million of net income. Its EBIT was $27.3 million, and its tax rate was 35%. What was its interest expense?
[Hint: Write out the headings for an income statement and then fill in the known values. Then divide $13 million net income by (1 - T) = 0.65 to find the pretax income. The difference between EBIT and taxable income must be the 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.