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Problem: Income Statement. The ABC Company had revenues of $925,000 in 2018. Its operating expenses (excluding...

Problem: Income Statement. The ABC Company had revenues of $925,000 in 2018. Its operating expenses (excluding depreciation) amounted to $325,000, depreciation charges were $125,000, and interest costs totaled $55,000. If the firm pays a marginal tax rate of 34 percent, calculate its net income after taxes.

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Answer #1
Revenues $ 925,000
Less: Operating Expenses 325,000
Earnings before Interest, Taxes, Depreciation and Amortization ( EBITDA) 600,000
Less: Depreciation Expense 125,000
Earnings before Interest and Taxes ( EBIT) 475,000
Less: Interest Costs 55,000
Earnings before Taxes 420,000
Less: Taxes ( 34 % ) 142,800
Net Income $ 277,200
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