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Fill in the missing numbers for the following income statement. (Input all amounts as positive values. Do not round intermediate calculations.)
Fill in the missing numbers for the following income statement. (Input all amounts as positive values. Do not round intermediate calculations.) Sales Costs Depreciation EBIT Taxes (22%) Net income 747,300 582,600 89,300
a. Calculate the OCF. (Do not round intermediate calculations.)
b. What is the depreciation tax shield? (Do not round intermediate calculations.)
a. OCF
b. Depreciation tax shield
Answer: See explanationExplanation:Sales = 747300Less: Costs = 582600Less: Depreciation = 89300EBIT = 75400Less: Taxes at 22% = 22% × 75400 = 16588Net income = EBIT - Taxes = 75400 - 16588 = 58812a. Calculate the OCF.OCF will be calculated as:= Net income + Depreciation= 58812 + 89300= 148,112b. What is the depreciation tax shield?Depreciation tax shield will be:= Depreciation × Tax rate= 89300 × 22%= 89300 × 0.22= 19646...
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