Use the information in the table below to calculate NOPLAT at the end of Year 2....
Use the information in the table below to calculate NOPLAT at the end of Year 2. Income statement Year 0 Year 1 Year 2 Reorganized balance sheet Year 0 Year 1 Year 2
Revenues 2,500.0 2,750.0 3,000.0
Operating working capital 125.0 137.5 150.0
Operating costs (1,500.0) (1,650.0) (1,760.0)
Property and equipment 1,000.0 1,100.0 1,200.0
Depreciation (50.0) (65.0) (80.0) Invested capital 1,125.0 1,237.5 1,350.0
Operating profits 950.0 1,035.0 1,160.0 Debt 100.0 100.0 100.0
Interest (10.0) (10.0) (10.0) Shareholders' equity 1,025.0 1,137.5 1,250.0
Earnings before taxes 940.0 1,025.0 1,150.0
Invested capital 1,125.0 1,237.5 1,350.0 Taxes (225.6) (246.0) (276.0)
Net income 714.4 779.0 874.0
Operating-profit tax rate 24%
A.954.0 B.881.6 C.1,160.0 D.786.6
Homework Answers
| P&L | |||
| Particulars | Year 0 | Year 1 | Year 2 |
| Revenue from operations | |||
| Revenue | 2500 | 2750 | 3000 |
| Expenses: | |||
| Operating cost | 1500 | 1650 | 1760 |
| Depreciation | 50 | 65 | 80 |
| Operating profit | 950 | 1035 | 1160 |
| Interest | 10 | 10 | 10 |
| Earning before taxes (EBT) | 940 | 1025 | 1150 |
| Taxes | 225.6 | 246 | 276 |
| Earning after tax | 714.4 | 779 | 874 |
Adjusted tax on opearting profit @ 24% = 278.4
NOPLAT at the end of year 2 = 1160-278.4
= 881.6
Assuming that PPE is net of accumulated depreciation.
| Balance sheet | |||
| Particulars | Year 0 | Year 1 | Year 2 |
| Assets | |||
| PPE | 1000 | 1100 | 1200 |
| Current Assets | 135 | 147.5 | 160 |
| 1135 | 1247.5 | 1360 | |
| Equity and liabilities | |||
| Share capital | 1025 | 1137.5 | 1250 |
| Debt | 100 | 100 | 100 |
| Current liabilities | 10 | 10 | 10 |
| 1135 | 1247.5 | 1360 |
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Use the information in the table below to calculate NOPLAT at
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