Question

I, for some reason, cannot pinpoint where exactly this pretax income (income before taxes) comes from. Been doing what my professor says word for word but I'm trapped. This comes from USAT's income statement on WSJ. If you need more information I will provide it. What I have is wrong

2014 35.940 42.345 58.078 77.408 104.093 18.57822.387 37.177 50.84872.847 2012 2013 2015 2016 2017e 2018e 2019e 10 Sales Cost of Sales 12 Gross Profit 13 17.362 19.958 20.901 26.560 31.246 25.384 5.618 0.244 SG&A 11.74114.036 16.451 20.473 5.222 0.865 15 Depreciation 4.580 5.486 5.731 16 Operating Profit 1.042 0.436 -1.282 18 19 20 21 22 Interest Expense 23 Income Before Taxes 24 25 26 NI before extraordinary item 27 28 Loss(gain) Extraordinary Charge 29 Reported Net Incom 30 31 Shares Outstanding 32 Depreciation EBITDA 4.580 5.621 5.486 5.922 5.731 4.449 5.222 6.087 5.618 5.862 0.149 -0.257 1.191 0.302 0.980 -0.6 0.892 1.136 0.693 1.465 0.087 1.049 Income Tax 0.028 27.255 0.2891 -0.615 1.16327.949-1.269 2.080 0 0 0 0 0

Below is what I grabbed from WSJ's annual income statement for USAT. The pretax income shown here is what I am trying to get on my pro-forma. But no matter what I do I just can't get it

Answer 1

Income before taxes = Operating profit (Row 16) - interest expenses (Row 22)

As the interest expenses are in negative it will increase the operating profit.