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Strategies & Market Trends : Employee Stock Options - NQSOs & ISOs

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To: rkral who wrote (4)6/10/2002 6:58:01 PM
From: hueyoneRead Replies (1) of 786
 
Unless I've gone totally crackers, I believe you were correct the first time, when dividing 722M by the 0.37 to get $1950M. When in doubt, just ask yourself how you would get from a pre-tax number to an after-tax number. Most everyone gets that direction correct .. we just multiply the pre-tax by the tax rate. Going the other way? Divide the after-tax by the tax rate.

Ron: Please do the math yourself. In this case we are trying to to determine how much additional pre tax expense it would take to reduce after tax net income by 722 million dollars. The answer is 722M/(1-tax rate). When in doubt, don't ask questions, just do the math and see if it works. I stand by this calculation.<gg>

Best, Huey
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