Question

In: Finance

Initial Investment: $1,000,000 WACC: 10% Revenue: 850,000 COGS: $540,000 Operating Expenses: $50,000 Depreciation Expense: $125,000 Tax...

Initial Investment: $1,000,000
WACC: 10%
Revenue: 850,000
COGS: $540,000
Operating Expenses: $50,000
Depreciation Expense: $125,000
Tax Expense: $28,350

What is Profit Margin?

Solutions

Expert Solution

Computation of Gross Profit Margin

Revenue = 850,000

Less: COGS = 540,000

Gross Profit = 310,000

Gross profit margin = Gross Profit/Sales*100

= 310,000/850,000*100

= 36.47%

Computation of Net Profit Margin

Revenue = 850,000

Less: COGS = 540,000

Gross Profit = 310,000

Less: Operating Expenses = 50,000

Less: Depreciation Expenses = 125,000

Less: Tax Expenses = 28,350

Net Profit = 106,650

Net Profit Margin = Net Profit / Revenue*100

= 106,650/850,000*100

= 12.55%

jeff jeffy answered 2 years ago
Next > < Previous

Related Solutions

Initial Investment: $1,000,000 WACC: 10% Revenue: 850,000 COGS: $540,000 Operating Expenses: $50,000 Depreciation Expense: $125,000 Tax...
Initial Investment: $1,000,000 WACC: 10% Revenue: 850,000 COGS: $540,000 Operating Expenses: $50,000 Depreciation Expense: $125,000 Tax Expense: $28,350 What is the cumulative Net Cash Flow for the first year?
Initial Investment: $1,000,000 WACC: 10% Revenue: 850,000 COGS: $540,000 Operating Expenses: $50,000 Depreciation Expense: $125,000 Tax...
Initial Investment: $1,000,000 WACC: 10% Revenue: 850,000 COGS: $540,000 Operating Expenses: $50,000 Depreciation Expense: $125,000 Tax Expense: $28,350 Time: 1 year What is the Net Present Value?
Initial Investment: $1,000,000WACC: 10%Revenue: 850,000COGS: $540,000Operating Expenses: $50,000Depreciation Expense: $125,000Tax...
Initial Investment: $1,000,000WACC: 10%Revenue: 850,000COGS: $540,000Operating Expenses: $50,000Depreciation Expense: $125,000Tax Expense: $28,350What is the Operational Cash Flow for the first year?
AFTER TAX CASH FLOW Initial investment in the asset $80,000 Annual revenues $50,000 Annual expenses $20,000...
AFTER TAX CASH FLOW Initial investment in the asset $80,000 Annual revenues $50,000 Annual expenses $20,000 Duration 6 years. Since the asset was in very good condition, it was sold ate the end of the 6 th year in $35,000 instead of $20,000. Calculate the After Tax Cash Flow and After Tax NPV for this project, using a tax rate of 30%, an after tax MARR of 12% per year
Year 1 Year 2 Revenues 128.9 151.6 COGS and Operating Expenses (other than depreciation) 49.6 52.7...
Year 1 Year 2 Revenues 128.9 151.6 COGS and Operating Expenses (other than depreciation) 49.6 52.7 Depreciation 24.9 43.5 Increase in Net Working Capital 3.4 8.1 Capital Expenditures 27.3 43.2 Marginal Corporate Tax Rate 35% 35% a. What are the incremental earnings for this project for years 1 and​ 2?​ (Note: Assume any incremental cost of goods sold is included as part of operating​ expenses.) b. What are the free cash flows for this project for years 1 and​ 2?...
Year 1 Year 2 Revenues 120.8 150.6 COGS and Operating Expenses​ (other than​ depreciation) 46.1 54.5...
Year 1 Year 2 Revenues 120.8 150.6 COGS and Operating Expenses​ (other than​ depreciation) 46.1 54.5 Depreciation 24.9 32.9 Increase in Net Working Capital 2.8 8.2 Capital Expenditures 29.2 38.4 Marginal Corporate Tax Rate 35​% 35​% a. What are the incremental earnings for this project for years 1 and​ 2?​ (Note: Assume any incremental cost of goods sold is included as part of operating​ expenses.) b. What are the free cash flows for this project for years 1 and​ 2?
Year 1 Year 2 Revenues 126.1126.1 155.6155.6 COGS and Operating Expenses​ (other than​ depreciation) 36.236.2 57.157.1...
Year 1 Year 2 Revenues 126.1126.1 155.6155.6 COGS and Operating Expenses​ (other than​ depreciation) 36.236.2 57.157.1 Depreciation 28.128.1 39.139.1 Increase in Net Working Capital 2.32.3 8.68.6 Capital Expenditures 28.528.5 37.637.6 Marginal Corporate Tax Rate 3535​% 3535​% a. What are the incremental earnings for this project for years 1 and​ 2?​ (Note: Assume any incremental cost of goods sold is included as part of operating​ expenses.) b. What are the free cash flows for this project for years 1 and​ 2?...
XYZ Inc., has sales of $800,000, costs of $375,000, depreciation expense of $85,000, interest expense of $50,000, and a tax rate of 35%.
XYZ Inc., has sales of $800,000, costs of $375,000, depreciation expense of $85,000, interest expense of $50,000, and a tax rate of 35%. What is the net income of this firm? (10 Points)The income statement for the company is(Use Excel and Excel Formulas to answer)  
RipplingBrook Mining Co. had operating cashflow equal to $50,000. Depreciation expense during the year was $7,500....
RipplingBrook Mining Co. had operating cashflow equal to $50,000. Depreciation expense during the year was $7,500. Interest expense was $3,000 and the company paid down $3,500 in long term debt. The company spent $20,000 on new equipment and had an increase in working capital of $1,000. What was the cash flow to stockholders?
2. RipplingBrook Mining Co. had operating cashflow equal to $50,000. Depreciation expense during the year was...
2. RipplingBrook Mining Co. had operating cashflow equal to $50,000. Depreciation expense during the year was $7,500. Interest expense was $3,000 and the company paid down $3,500 in long term debt. The company spent $20,000 on new equipment and had an increase in working capital of $1,000. What was the cash flow to stockholders?
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT