Question

In: Finance

A firm has net sales of $5,500,000, Cost of Goods Sold $3,500,000, Depreciation Expense
of $300,000,...

A firm has net sales of $5,500,000, Cost of Goods Sold $3,500,000, Depreciation Expense
of $300,000, Selling and Administrative Expenses of $500,000, Interest Expense of $200,000, and an average tax rate of 20%.

25. The firm's Net Income is:

  • a. 210,000
  • b. 400,000
  • c. 
700,000
  • d 
800,000

26. The firm's Operating Margin is:

a. 14.0%

b. 21.8%

c. 33.3%


d. 
67.1%

27. firm's Gross Profit Margin is:

a. 21.5%

b. 30.0%

c. 
36.4%

d 
50.0%

28. firm's Pre-taxable Income is:

  • a. 1, 200,000
  • b. 1,000,000
  • c. 800,000
  • d. 500,000

Solutions

Expert Solution

Ans. Particulars Amount
Net sales revenue $5,500,000
Less: Cost of goods sold -$3,500,000
Gross margin $2,000,000
Less: Operating expenses:
Depreciation expenses -$300,000
Selling, general & administrative expenses -$500,000
Operating income (EBIT) $1,200,000
Less: Interest expenses -$200,000
Earnings before tax $1,000,000
Less: Tax ($1,000,000 * 20%) -$200,000
Net income $800,000
Ans. 25 Option   d     $800,000
Ans. 26 Option b     21.8%
Operating margin   = Operating income / Net sales * 100
$1,200,000 / $5,500,000 * 100
21.8%
Ans. 27 Option c    36.4%
Gross profit margin   = Gross profit / Net sales * 100
$2,000,000 / $5,500,000 * 100
36.4%
Ans. 28 Option b     $1,000,000
Pre taxable income =   Earnings before taxes

jeff jeffy answered 3 months ago
Next > < Previous

Related Solutions

    income statement Sales 205,000 cost of goods sold -97,000 salaries expense -24,000 depreciation expense -16,000...
    income statement Sales 205,000 cost of goods sold -97,000 salaries expense -24,000 depreciation expense -16,000 interest expense -2,400 loss on equipment disposal -2,500 net income 63,100 Statement of Retained Earnings Beginning Balance - Retained Earnings                   6,000 Plus - Net Income                 63,100 Less - Dividends (41,500) Ending Balance - Retained Earnings 27,600 Balance sheets 2018 2019 change Assets: Cash 13,000 64,600 51,600 Accounts Receivable 25,000 19,000 (6,000) Inventory 19,000 13,000 (6,000) prepaid expenses 0 0 0 Equipment 60,000 41,000 (19,000)...
Assume sales are $7,990, cost of goods sold is $2,120, depreciation expense is $140, interest paid...
Assume sales are $7,990, cost of goods sold is $2,120, depreciation expense is $140, interest paid is $180, selling and general expenses are $360, dividends paid are $1,170, and the tax rate is 21 percent. What is the addition to retained earnings? Group of answer choices $2,005.80 $4,100.10 $2,930.10 $3,175.80
2013 2014 sales 2100 Cost of Goods Sold 1200 Depreciation Expense 225 Interest Expense 175 Current...
2013 2014 sales 2100 Cost of Goods Sold 1200 Depreciation Expense 225 Interest Expense 175 Current Assets 1000 1300 Total Fixed Assets 3500 4000 Accumulated Depreciation 1250 This can be determined from the information given Current Liabilities 900 975 Long-term Debt 1500 1350 Common Stock 400 This can be determined from the information given Question 1 part one) Use the information above to construct a 2014 income statement and balance sheets for both years. The average tax rate is 35%...
You are given the following information: 2018 Sales $23,000 Cost of goods sold $16,000 Depreciation expense...
You are given the following information: 2018 Sales $23,000 Cost of goods sold $16,000 Depreciation expense $4,000 Interest $1,800 Dividends $1,300 Tax rate 35% New debt issuance $2,000 2017 2018 Current assets $4,800 $5,900 Current liabilities $2,700 $3,200 Net fixed assets $14,000 $17,000 a. Calculate the operating cash flow for 2018. (Hint: Taxes = Earnings before taxes x Tax rate) (show your work) b. Calculate the cash flow from assets for 2018. (show your work ) c. Calculate the cash...
sales=$10,980 cost of goods sold=$8,100 depreciation expense=$1,440 interest expense=$180 dividends paid=$270 Tax rate for the year...
sales=$10,980 cost of goods sold=$8,100 depreciation expense=$1,440 interest expense=$180 dividends paid=$270 Tax rate for the year was 35% what is the operating cash flow for the year
2013 2014 Sales $2100 Cost of Goods Sold $1200 Other operating expenses $200 Depreciation Expense $225...
2013 2014 Sales $2100 Cost of Goods Sold $1200 Other operating expenses $200 Depreciation Expense $225 Interest Expense $175 Current Assets $1000 $1300 Total Fixed Assets $3500 $4000 Accumulated Depreciation $1250 This can be determined from the information given Current Liabilities $900 $975 Long-term Debt $1500 $1350 Common Stock $400 This can be determined from the information given A company has the financial data above for years 2013 and 2014. The average tax rate is 35% and the dividend payout...
OPQ, Inc. 2018 statement of comprehensive income Net sales $8,953 Cost of goods sold $5,865 Depreciation...
OPQ, Inc. 2018 statement of comprehensive income Net sales $8,953 Cost of goods sold $5,865 Depreciation $? EBIT $? Interest paid $675 Earnings before taxes $675 Taxes $400 Net income $705 Dividends paid $? Addition to retained earnings $450 OPQ, Inc. Statement of financial positions as of December 31, 2017 and 2018 2017 2018 2017 2018 Cash $725 $1,135 Accounts payable $859 $1,031 Accounts rec. $2,330 $? Notes payable $? $4,020 Inventory $3,240 $5, 202 Current liabilities $? $? Current...
Major Manuscripts, Inc. 2012 Income Statement Net sales $ 8,600 Cost of goods sold 7,550 Depreciation...
Major Manuscripts, Inc. 2012 Income Statement Net sales $ 8,600 Cost of goods sold 7,550 Depreciation 310 Earnings before interest and taxes $ 740 Interest paid 40 Taxable Income $ 700 Taxes 280 Net income $ 420 Dividends $ 194 Major Manuscripts, Inc. 2012 Balance Sheet 2012 2012 Cash $ 2,420 Accounts payable $ 2,320 Accounts rec. 960 Long-term debt 280 Inventory 2,800 Common stock $ 2,400 Total $ 6,180 Retained earnings 4,580 Net fixed assets 3,400 Total assets $...
. installment sales for 2018 is $600,000 and cost of goods sold $300,000 while the installment...
. installment sales for 2018 is $600,000 and cost of goods sold $300,000 while the installment sales in 2019 is $1,000,000 and cost of goods sold $800,000, cash collection from 2018 sales was $400,000 in 2018 and $200,000 in 2019, cash collection from 2019 sales was $500,000 in 2019 and $500,000 in 2020, using cost recovery method compute gross profit realized in 2018? a. $100,000. b. $200,000. c. $300,000. d. $150,000.
Income Statement data: Advertising expense $ 150,000 Cost of goods sold 3,700,000 Delivery expense 30,000 Depreciation...
Income Statement data: Advertising expense $ 150,000 Cost of goods sold 3,700,000 Delivery expense 30,000 Depreciation expense-office buildings and equipment 30,000 Depreciation expense-store buildings and equipment 100,000 Income tax expense 140,500 Interest expense 21,000 Interest revenue 30,000 Miscellaneous administrative expense 7,500 Miscellaneous selling expense 14,000 Office rent expense 50,000 Office salaries expense 170,000 Office supplies expense 10,000 Sales 5,313,000 Sales commissions 185,000 Sales salaries expense 385,000 Store supplies expense 21,000 Retained earnings and balance sheet data: Accounts payable $ 194,300...
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT