The Redding Co has sales of $116,097, operating costs of $68,608, depreciation of $15,000, and debt of...

The Redding Co has sales of $116,097, operating costs of $68,608, depreciation of $15,000, and debt of $9,000 for which it pays 8% interest. If it is paying taxes at 35% what is its net income?

Expert Solution

Sales	$116,097
Less: Operating costs	$68,608
Less: Depreciation	$15,000
EBIT	$32,489
Less: Interest($9,000 * 0.08)	$720
EBT	$31,769
Less: Taxes($31,769 * 0.35)	$11,119.15
Net income	$20,649.85

jeff jeffy answered 2 years ago

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