Please assist with the given problem. Provide step by step calculations.
Question 1: Dominion expects to have net income next year of $24 million and Free Cash Flow of $27 million. Dominion's marginal corporate tax rate is 40%. What Dominion's EBIT? [Hint: EBIT = NI + Taxes + Interest expense]
Question 2: Dominion expects to have net income next year of $24 million and Free Cash Flow of $27 million. Dominion's marginal corporate tax rate is 40%. If Dominion increases leverage so that its interest expense rises by $1 million, then what will be the amount of its net income? [Hint: (EBIT - Interest Expense - chg IE) x (After-tax cash flow) = NI + chg NI]