Earnings after tax = Dividends paid to preferred and common stockholders + Addition to retained earnings = $495,000 + $1,000,000 = $1,495,000
Earnings before tax = Earnings after tax / ( 1 - Tax % ) = $1,495,000 / ( 1 - 35% ) = $2,300,000
Earnings before interest and tax (EBIT) = Earnings before tax + Interest expense = $2,300,000 + $850,000 = $3,150,000
Gross profit = Net sales - Cost of goods sold = $11,250,000 - $7,500,000 = $3,750,000
Gross profit - Total operating expenses = EBIT
$3,750,000 - Total operating expenses = $3,150,000
Total operating expenses = $3,750,000 - $3,150,000 = $600,000
Depreciation expenses = Total operating expenses - Other operating expenses = $600,000 - $250,000 = $350,000
Income Statement You have been given the following information for Corky's Bedding Corp.: a. Net sales...
Income Statement You have been given the following information for Corky's Bedding Corp.: a. Net sales $11,250,000. b. Cost of goods sold $7,500,000. c. Other operating expenses= $250,000. d. Addition to retained earnings = $1,000,000. e. Dividends paid to preferred and common stockholders $495,000. r. Interest expense= $850,000 The firm's tax rate is 35 percent. Calculate the depreciation expense for Corky's Bedding Corp. (LG2-1) 2-21
You have been given the following information for Corky's Bedding Corp a. Net sales = $12,550,000 b. Cost of goods sold = $9,100,000. c. Other operating expenses = $270,000. d. Addition to retained earnings = $1,050,000. e. Dividends paid to preferred and common stockholders - $385,000. f. Interest expense $960,000, all of which is tax deductible. The firm's tax rate is 21 percent. Calculate the depreciation expense for Corky's Bedding Corp. (Round your answer to the nearest dollar amount.) Depreciation...
You have been given the following information for PattyCake’s Athletic Wear Corp. for the year 2018: Net sales = $39,050,000. Cost of goods sold = $22,250,000. Other operating expenses = $6,700,000. Addition to retained earnings = $1,213,500. Dividends paid to preferred and common stockholders = $1,950,500. Interest expense = $1,865,000. The firm’s tax rate is 30 percent. In 2019: Net sales are expected to increase by $10.05 million. Cost of goods sold is expected to be 60 percent of net...
Retained Earnings Question You have been given the following information for PattyCake’s Athletic Wear Corp. for the year 2018: Net sales = $38,700,000. Cost of goods sold = $22,180,000. Other operating expenses = $6,000,000. Addition to retained earnings = $1,206,500. Dividends paid to preferred and common stockholders = $1,933,000. Interest expense = $1,830,000. The firm’s tax rate is 30 percent. In 2019: Net sales are expected to increase by $9.70 million. Cost of goods sold is expected to be 60...
You have been given the following information for PattyCake’s Athletic Wear Corp. for the year 2021: Net sales = $38,450,000. Cost of goods sold = $22,130,000. Other operating expenses = $5,500,000. Addition to retained earnings = $1,201,500. Dividends paid to preferred and common stockholders = $1,920,500. Interest expense = $1,805,000. The firm’s tax rate is 30 percent. In 2022: Net sales are expected to increase by $9.45 million. Cost of goods sold is expected to be 60 percent of net...
Net sales = $42,000,000. Gross profit = $19,200,000. Other operating expenses = $3,200,000. Addition to retained earnings = $5,200,000. Dividends paid to preferred and common stockholders = $2,000,000. Depreciation expense = $2,930,000. The firm’s tax rate is 36 percent. interest expense for Moore’s HoneyBee Corp.
The financial statements of Snapit Company are given below. Snapit Company Income Statement (2009) Sales $ 4,000,000 Cost of goods sold 3,040,000 Gross profit 960,000 Selling & administrative expenses 430,000 Operating profit 530,000 Interest expense 160,000 Income before tax 370,000 Tax expense 148,000 Net income $ 222,000 Balance Sheet 2009 2008 Cash $ 60,000 $ 50,000 Accounts receivable 550,000 500,000 Inventory 690,000 620,000 Total current assets $ 1,300,000 $ 1,170,000 Fixed assets 1,300,000 1,230,000 Total assets $ 2,600,000 $ 2,400,000...
Presented below is information related to Blossom Corp. for the year 2020. Net sales Cost of goods sold Selling expenses Administrative expenses Dividend revenue Interest revenue $1,612,000 967.200 80,600 59.520 24,800 8.680 Write-off of inventory due to obsolescence Depreciation expense omitted by accident in 2019 Casualty loss Cash dividends declared Retained earnings at December 31, 2019 Effective tax rate of 20% on all items $99,200 68.200 62,000 55,800 1.215.200 Prepare a multiple-step income statement for 2020. Assume that 94.240 shares...
Net Income and OCF: During 2010, Raines Umbrella Corp. had sales of &740,000. Costs of goods sold, administrative and selling expenses, and depreciation expenses were $610,000, $105,000, and $140,000, respectively. In addition, the company had an interest expense of $70,000 and a tax rate of 35 percent. (Ignore any tax loss carryback or carryforward provisions.) What is Raines’ net income for 2010? What is its operating cash flow? Explain your results in (a) and (b).
During 2010, Raines Umbrella Corp. had sales of $850,000. Cost of goods sold, administrative and selling expenses, and depreciation expenses were $610,000, $110,000, and $140,000, respectively. In addition, the company had an interest expense of $85,000 and a tax rate of 35 percent. (Ignore any tax loss carryback or carryforward provisions.) Suppose Raines Umbrella Corp. paid out $63,000 in cash dividends. Is this possible? If spending on net fixed assets and net working capital was zero, and if no...