Question
In: Finance
A firm reported the following income statement (all figures arein thousands of dollars):Net Sales...
A firm reported the following income statement (all figures are in thousands of dollars):
| Net Sales | 1,100 | |
| - | operating costs | 200 |
| - | depreciation & amortization | 230 |
| = | Operating Income (EBIT) | ? |
| - | interest | 76 |
| = | Earnings Before Taxes (EBT) | ? |
| - | taxes | 81 |
| = | Net Income | ? |
What is the operating income of this firm?
NOTE: the - and = in red have been added to serve as a hint on how to compute each item of interest.
A firm reported the following income statement (all figures are in thousands of dollars):
| Net Sales | 1,550 | |
| - | operating costs | 200 |
| - | depreciation & amortization | 220 |
| = | Operating Income (EBIT) | ? |
| - | interest | 77 |
| = | Earnings Before Taxes (EBT) | ? |
| - | taxes | 70 |
| = | Net Income | ? |
What is the net income of this firm?
NOTE: the - and = in red have been added to serve as a hint on how to compute each item of interest.
A firm reported the following income statement (all figures are in thousands of dollars):
| Net Sales | 1,595 | |
| - | operating costs | 200 |
| - | depreciation & amortization | 200 |
| = | Operating Income (EBIT) | ? |
| - | interest | 121 |
| = | Earnings Before Taxes (EBT) | ? |
| - | taxes | ? |
| = | Net Income | ? |
What is the amount of taxes the firm is charged, given that the tax rate is 30%?
answer using one decimal figure.
NOTE: the - and = in red have been added to serve as a hint on how to compute each item of interest.
Solutions
Expert Solution
Q-1) Operating Income(EBIT) = Sales - Operating Costs - depreciation & amortization
EBIT = $1100,000 - $200,000 - $230,000
EBIT = $670,000
Q-2)
Operating Income(EBIT) = Sales - Operating Costs - depreciation & amortization
EBIT = $1550,000 - $200,000 - $220,000
EBIT = $1130,000
Net Income = EBIT - Interest Expenses - Taxes
Net Income = $1130,000 - $77,000 - $70,000
Net Income = $983,000
Q-3)
Operating Income(EBIT) = Sales - Operating Costs - depreciation & amortization
EBIT = $1595,000 - $200,000 - $200,000
EBIT = $1195,000
Earnings Before Taxes (EBT)= EBIT - Interest Expenses
Earnings Before Taxes (EBT)= $1195,000 - $121,000
Earnings Before Taxes (EBT) = $1074,000
Amount of taxes = Earnings Before Taxes (EBT)*Tax Rate
Amount of taxes = $1074,000*30%
Amount of taxes = $322,200
jeff jeffy answered 1 year agoRelated Solutions
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Net Income
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Current Year
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Revenues:
3
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dollars) for the two recent fiscal years was adapted from the
annual report of Speedway Motorsports, Inc., owner and operator of
several major motor speedways, such as the Atlanta, Texas, and Las
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