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The Ivanhoe Chemical Corporation announced that, for the period ending March 31, 2017, it had earned...

The Ivanhoe Chemical Corporation announced that, for the period ending March 31, 2017, it had earned income after taxes of $2,768,313.00 on revenues of $13,148,000. The company's costs (excluding depreciation and amortization) amounted to 61 percent of sales, and it had interest expenses of $392,168. What is the firm's depreciation and amortization expense if its average tax rate is 34 percent? (Round answer to 2 decimal places e.g. 15.25.)

Depreciation and amortization enter the Depreciation and amortization in dollars rounded to 2 decimal places

Solutions

Expert Solution

Revenues 13,148,000
Less:Costs(excluding depreciation and amortization)(13,148,000*61%) 8020280
Less:depreciation and amortization expense(balance)(13,148,000-8020280-4586581.64) $541138.36
EBIT(4194413.64+392,168) 4586581.64
Less:interest expense 392,168
EBT(100%)(2,768,313/0.66) 4194413.64
Less:tax@34%(4194413.64*34%) 1426100.64
Net income(66%) 2,768,313

jeff jeffy answered 3 years ago
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