Question

Bae Inc. has the following income statement. How much net operating profit after taxes (NOPAT) does the firm have?

Sales
$2,000.00
Costs
1,200.00
Depreciation
100.00
EBIT
$ 700.00
Interest expense
200.00
EBT
$ 500.00
Taxes (35%)
175.00
Net income
$ 325.00

Ans. a) $370.60 b) $390.11 c)$410.64 d)$432.25 e)$455.00

Answer 1

Net operating profit after tax (NOPAT) is a company's after-tax operating profit for all investors, including shareholders and debt holders. It is equivalent to earnings before interest after taxes (EBIAT).
So, NOPAT = (2000 - 1200 - 100)*(1 - 0.35) = $455.00.
So, the right answer is e.