Essentials of Corporate Finance (Mcgraw-hill/Irwin Series in Finance, Insurance, and Real Estate)
9th Edition
ISBN: 9781259277214
Author: Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Bradford D Jordan Professor
Publisher: McGraw-Hill Education
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Chapter 2, Problem 15QP
Using Income Statements. Given the following information for Sookie’s Cookies Co., calculate the
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Given the following information for Sookie's Cookies Co., calculate the depreciation expense: sales
- $97,009; costs - $52,981; addition to retained earnings - $1,062; dividends paid - $1,821;
interest expense = $1,439; tax rate= 39 percent. (Hint: Build the Income Statement and fill in the
missing pieces until you get to the depreciation expense. You may have to work from bottom up.)
You are given the following information for Bowie Pizza Co. Sales = $64,000; Costs = $30,700, Addition to retained earnings expense = $4,400; Tax rate = 22 percent. $5/700. Dividends paid - $1.980 Interest Calculate the depreciation expense.
You are given the following information for Troiano Pizza Company: sales = $76,600; costs = $55,300; addition to retained earnings =
$6,300; dividends paid = $2,960; interest expense = $2,670; tax rate=24 percent. Calculate the depreciation expense for the
company.
Note: Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.
Depreciation expense
Chapter 2 Solutions
Essentials of Corporate Finance (Mcgraw-hill/Irwin Series in Finance, Insurance, and Real Estate)
Ch. 2.1 - Prob. 2.1ACQCh. 2.1 - Prob. 2.1BCQCh. 2.1 - What do we mean by financial leverage?Ch. 2.1 - Explain the difference between accounting value...Ch. 2.2 - What is the income statement equation?Ch. 2.2 - What are the three things to keep in mind when...Ch. 2.2 - Why is accounting income not the same as cash...Ch. 2.3 - What is the difference between a marginal and an...Ch. 2.3 - Do the wealthiest corporations receive a tax break...Ch. 2.4 - Prob. 2.4ACQ
Ch. 2.4 - Prob. 2.4BCQCh. 2.4 - Why is interest paid not a component of operating...Ch. 2 - What is the relationship between current assets...Ch. 2 - What is the purpose of the income statement?Ch. 2 - Prob. 2.3CCh. 2 - Prob. 2.4CCh. 2 - Liquidity. What does liquidity measure? Explain...Ch. 2 - Accounting and Cash Flows. Why is it that the...Ch. 2 - Book Values versus Market Values. In preparing a...Ch. 2 - Prob. 4CTCRCh. 2 - Prob. 5CTCRCh. 2 - Prob. 6CTCRCh. 2 - Prob. 7CTCRCh. 2 - Net Working Capital and Capital Spending. Could a...Ch. 2 - Prob. 9CTCRCh. 2 - Firm Values. Referring back to the examples used...Ch. 2 - Building a Balance Sheet. Bear Tracks, Inc., has...Ch. 2 - Building an Income Statement. Pharrell, Inc., has...Ch. 2 - Dividends and Retained Earnings. Suppose the firm...Ch. 2 - Per-Share Earnings and Dividends. Suppose the firm...Ch. 2 - Prob. 5QPCh. 2 - Tax Rates. In Problem 5, what is the average tax...Ch. 2 - Calculating OCF. Hailey, Inc., has sales of...Ch. 2 - Prob. 8QPCh. 2 - Calculating Additions to NWC. The December 31,...Ch. 2 - Cash Flow to Creditors. The December 31, 2015,...Ch. 2 - Cash Flow to Stockholders. The December 31, 2015,...Ch. 2 - Prob. 12QPCh. 2 - Market Values and Book Values. Klingon Widgets,...Ch. 2 - Prob. 14QPCh. 2 - Using Income Statements. Given the following...Ch. 2 - Prob. 16QPCh. 2 - Prob. 17QPCh. 2 - Prob. 18QPCh. 2 - Net Income and OCF. During the year, Belyk Paving...Ch. 2 - Prob. 20QPCh. 2 - Prob. 21QPCh. 2 - Prob. 22QPCh. 2 - Prob. 23QPCh. 2 - Net Fixed Assets and Depreciation. On the balance...Ch. 2 - Tax Rates. Refer to the corporate marginal tax...Ch. 2 - Prob. 1CCCh. 2 - Prob. 2CC
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- You are given the following information for Troiano Pizza Company: sales = $69,400; costs = $52,100; addition to retained earnings = $4,700; dividends paid = $2,480; interest expense = $2,190; tax rate = 21 percent. Calculate the depreciation expense for the company. Note: Do not round intermediate calculations and round your answer to the nearest whole number Depreciation Expense =arrow_forwardYou are given the following information for Company A.: sales = $73,900; costs = $54,100; addition to retained earnings = $5,700; dividends paid = $2,780; interest expense = $2,490; tax rate = 21 percent. What is Depreciation Expense for company Calculate the depreciation expense for the company.arrow_forwardYou are given the following information for Troiano Pizza Company: Sales = $72,000; Costs = $32,300; Addition to retained earnings = $6,500; Dividends paid = $2,220; Interest expense = $5,200; Tax rate = 23 percent. Calculate the depreciation expense. (Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.) Depreciation expensearrow_forward
- You are given the following information for Troiano Pizza Company: Sales = $66,000; Costs = $31,100; Addition to retained earnings = $5,900; Dividends paid = $2,040; Interest expense = $4,600; Tax rate = 22 percent. Calculate the depreciation expense. (Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.)arrow_forwardYou are given the following information for Oceans of Fun.: sales = $74, 020; costs = $34, 980; addition to retained earnings 59,540; dividends paid $7,800; interest expense $2, 580; tax rate = 21 percent. Calculate the depreciation expense. (Do not round intermediate calculations.)arrow_forwardYou are given the following information for Troy Pizza Company: Sales = $70,000; Costs = $31,900; Addition to retained earnings = $6,300; Dividends paid = $2,160; Interest expense = $5,000; Tax rate = 21 percent. Calculate the depreciation expense. (Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.)arrow_forward
- You are given the following information for Troiano Pizza Company: sales = $84,700; costs = $58,900; addition to retained earnings = $8,100; dividends paid = $3,500; interest expense = $3,210; tax rate = 23 percent. Calculate the depreciation expense for the company. Note: Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.arrow_forwardYou are given the following information for O'Hara Marine Co.: sales = $76,240; costs = $35,310; addition to retained earnings = $9,600; dividends paid = $8,730; interest expense = $2,640; tax rate = 24 percent. Calculate the depreciation expense. (Do not round intermediate calculations.)arrow_forwardIf the following financial information related to XYZ Company. Total Revenues last year $870, depreciation expenses $40, costs of goods sold $350, and interest expenses $50. At the end of the year, current assets were $100 and current liabilities were $105. The company has an average tax rate of 30%. Calculate the net income for XYZ Company by setting up an income statement.arrow_forward
- ok at You are given the following information for Troiano Pizza Company: sales = $76,600; costs = $55,300; addition to retained earnings = $6,300; dividends paid = $2,960; interest expense = $2,670; tax rate = 24 percent. Calculate the depreciation expense for the company. Note: Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32. Depreciation expense $ 7,120arrow_forwardFill in the missing numbers for the following income statement, and find the OCF and depreciation tax shield. Answer Sales $658,400 OCF = Costs 419,400 Depreciation 98,600 EBIT Taxes (22%) Depreciation tax shield = Net incomearrow_forwardYou are given the following information for Sookie’s Cookies Co.: sales = $60000; costs = $37400; addition to retained earnings = $3100; dividends paid = $860; interest expense = $2050; tax rate = 39 percent. Calculate the depreciation expense for the company. (Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.)arrow_forward
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