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In: Finance

Explain & Show Work: Georgia Office Supplies recently reported $12,500 of sales, $7,250 of operating costs...

Explain & Show Work:

Georgia Office Supplies recently reported $12,500 of sales, $7,250 of operating costs other than depreciation, and $1,250 of depreciation. The company had no amortization charges and no non-operating income. It had $8,000 of bonds outstanding that carry a 7.5% interest rate, and its federal-plus-state income tax rate was 40%. The firm had 1000 shares outstanding

a) How much was the firm's taxable income, or earnings before taxes (EBT)?

b) What is the firm’s EPS assuming a Dividend of $ 100

Solutions

Expert Solution

INTEREST = 8000 X 7.5% = 600


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