Homework Answers
| (a)-Income Statement | |
| Particulars | Amount ($ in millions) |
| Net Sales | 150.00 |
| Less: Cost of goods sold | 50.00 |
| Less: Depreciation | 10.00 |
| Earnings before interest & taxes (EBIT) | 90.00 |
| Less: Interest Expenses | 10.00 |
| Earnings before taxes (EBT) | 80.00 |
| Less: Tax at 10% [$80.00 Million x 10%] | 8.00 |
| Net Income | 72.00 |
| (b)-Operating cash flow | |
| Operating cash flow = EBIT + Depreciation - Taxes | |
| Operating cash flow = $90.00 Million + $10.00 Million - $8.00 Million | |
| Operating cash flow = $92.00 Million |
| (a)-Income Statement | |
| Particulars | Amount ($ in millions) |
| Net Sales | 150.00 |
| Less: Cost of goods sold | 50.00 |
| Less: Depreciation | 10.00 |
| Earnings before interest & taxes (EBIT) | 90.00 |
| Less: Interest Expenses | 10.00 |
| Earnings before taxes (EBT) | 80.00 |
| Less: Tax at 10% [$80.00 Million x 10%] | 8.00 |
| Net Income | 72.00 |
| (b)-Operating cash flow | |
| Operating cash flow = EBIT + Depreciation - Taxes | |
| Operating cash flow = $90.00 Million + $10.00 Million - $8.00 Million | |
| Operating cash flow = $92.00 Million |
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