Fill in the missing numbers for the following income statement. (Do not roundintermediate calculations.)SalesCostsDepreciationEBITTaxes (21%)Net income$657,800418,70098,300a. Calculate the OCF. (Do not round intermediate calculations.)b. What is the depreciation tax shield? (Do not round intermediate calculations.)a. OCFb. Depreciation tax shield

Step 1: To complete the missing amounts in the income statement, here is its detailed solution:…

Answered: Fill in the missing numbers for the…

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter6: Accounting For Financial Management

Section: Chapter Questions

Problem 4MC

See similar textbooks

Similar questions

Which of the following is used when computing for the accounting rate of return (ARR)? a. Income before depreciation but after taxes. b. Income after depreciation and taxes. c. Income before depreciation and taxes d. Income after depreciation but before taxes.
Calculate the EBIT which should be used for the EV / EBIT multiple given the information below: Net revenues Cost of sales Gross Profit Selling, general and administrative expenses Amortization expense Restructuring costs Acquisition-related costs Asset impairment charges Gain on sales of assets Operating income Interest expense, net Loss on early extinguishment of debt Other expense, net Income (loss) before taxes (Benefit) provision for income taxes Net income (loss) Select one: 1,394,8 1,444.4 1,474.3 S 1,419.6 5,248.1 1,746.0 3,502.1 2,027.8 During fiscal 2050, the company sold assets relating to the Cutey brand for a total disposal price of $29.2. The Company allocated $4.2 of goodwill to the brand as part of the sale. The Company recorded a gain of $24.8 which has been reflected in Gain on sales of assets in the Consolidated Statement of Operations for the fiscal year ended June 30, 2050. 79.5 86.9 174.0 5.5 (24.8) 1,153.2 81.9 3.1 30.4 1,037.8 (40.4) 1,078.2
Assume an income statement with the following classifications: a. Revenuesb. Cost of goods soldc. Distribution expensesd.General & administrative expensese. Other revenues and expensesf. Income tax on income from continuing operationsg. Gain from disposal of discontinued operationsh. Income tax on gain from discontinued operationsi. None of the above Indicate by letter how each of the following should be classified: Income tax effect of loss on sale of plant Income tax on gain on sale of short-term investment in securities Interest expense Interest revenue Loss on sale of patent Dividend revenue from investment Sales returns Services sold
Question: (a) What is a Capital Recovery Amount Factor (b) Write a detailed note on Minimum Attractive Rate of Return. (c) "Land" is not considered as a depreciable property. WHY? (d) Differentiate between income tax and sales tax. Explain both of these types with the help of examples. ww aN
Problem 12-23 (Algorithmic) (LO. 5, 6) Zebra, Inc., a calendar year S corporation, incurred the following items this year. Sammy is a 30% Zebra shareholder throughout the year. Sales $135,000 Cost of goods sold (54,000) Depreciation expense (MACRS) (13,500) Administrative expenses (6,750) §1231 gain 21,000 Depreciation recapture income 28,500 Short-term capital loss from stock sale (6,500) Long-term capital loss from stock sale (5,500) Long-term capital gain from stock sale 17,000 Charitable contributions (5,800)
For each statement in parts a to d, give a short answer or indicate True orFalse. a. Which of the following is a cash flow: (1) depreciation, (2) loan interest paid, and/or (3) income tax. b. We know that depreciation law has changed dramatically since 1950; however, tax law has not changed. (T or F). c. Depreciation method affects taxes owed. (T or F). d. In an alternative evaluation, the inclusion of taxes will change the amount of the measures of merit (e.g., PW or AW), but will not change which alternative is selected as most desirable. (T or F).
Which of the following statements is false? A For tax purposes, companies can use the MACRS depreciation method. B When you change a depreciation estimate, such as salvage value, you need to make an adjustment to retained earnings. C If the expected future cash flow is less than the carrying amount, the asset is considered impaired. D If an impairment loss is recorded, depreciation must be recalculated since the book value changed. The answer A is wrong
The modified internal rate of return (MRR) test is designed to address a limitation associated withthe use of the internal rate of return (IRR). What is that limitation?a) Working capital requirementb) Income taxesc) Reinvestment rated) Depreciation expense
Which of the following statements is false? A For tax purposes, companies can use the MACRS depreciation method. B When you change a depreciation estimate, such as salvage value, you need to make an adjustment to retained earnings. C If the expected future cash flow is less than the carrying amount, the asset is considered impaired. D If an impairment loss is recorded, depreciation must be recalculated since the book value changed.
7) Net operating profit after tax (NOPAT) includes operating revenues less expenses such as: A) Cost of goods sold (COGS) B) C) D) E) F) Taxes on operating income Selling, general and administrative expenses (SG&A) After-tax earnings from investments and interest expenses All of the above A, B and C only
Gross profit is equal to Select one: a. revenues - expenses b. sales - cost of goods sold c. profits plus depreciation d. earnings before taxes minus taxes payable
Which of the following statements are true? Select one or more: a. MACRS must be used for book purposes if it is used for tax purposes. b. Managers often prefer the straight-line method because it helps to smooth earnings. c. Units of production method is not appropriate for natural resources. d. Double-declining balance recognizes more depreciation expense early in an asset's life. PreviousSave AnswersNext

SEE MORE QUESTIONS

Recommended textbooks for you

Intermediate Financial Management (MindTap Course…

Finance

ISBN:

9781337395083

Author:

Eugene F. Brigham, Phillip R. Daves

Publisher:

Cengage Learning