Consider the following income statement: Sales .......................... $713,500 Costs .......................... 497,300 Depreciation ................... 87,400 EBIT ................................ ?

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Consider the following income statement:

Sales .......................... $713,500

Costs .......................... 497,300

Depreciation ................... 87,400

EBIT ................................ ?

Taxes (34%) ........................ ?

Net income .......................... ?

Fill in the missing numbers and then calculate the OCF. What is the depreciation tax shield?

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Fundamentals of Corporate Finance

ISBN: 978-0077861704

11th edition

Authors: Stephen Ross, Randolph Westerfield, Bradford Jordan

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