Given the following information about a firm: Sales $58,432 Costs 32,700 Interest 4,400 Dividends 2,300 Additions...

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Question

business accounting

Answer 1

Answer #1

Information Given:-

Sales	$58432
Costs	$32700
Interest	$4400
Dividends	$2300
Addition to Retained Earnings	$6700
Tax rate	$35%

Assumption:-

Calculations:-

6700 = Proft after-tax - 2300

Net Profit after-tax = 6700 - 2300 = $4400

4400 = Earnings before tax - (0.35 * Earnings before tax)

4400 = Earnings before tax * (1-0.35)

Earnings before tax = 4400 / 0.65 = $6770

6770 = 58432 - 32700 - Depreciation - 4400

Depreciation = 58432 - 32700 - 4400 - 6770

Depreciation = $14562

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Answer 2

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