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A company reports sales revenue of $313 million, cost of goods sold of $183 million, selling...

A company reports sales revenue of $313 million, cost of goods sold of $183 million, selling and administration expenses of $79 million, depreciation of $20 million and interest expense of $9 million. What is the company's after-tax operating income (to one decimal place) if the corporate tax rate is 30%?

Solutions

Expert Solution

1. Sales = $313M

2. Total Expenses:

Cost of Goods Sold = $183M

Selling and administrative Expenses = $79M

Depreciation = $20M

Interest = $ 9M

Total expenses = $291

3. Total Operating profit before Tax = Sales - Total Expenses ($313M-$291M) = $22M

4. Tax Expense = $22M * 30% = $6.6M

5. Total Operating profit after Tax = $22M - $6.6M = $15.4M

jeff jeffy answered 2 years ago
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