2-11 (similar to) Question Help See Table 2.5 showing financial statement data and stock price data for Mydeco Corp. Suppose Mydeco had purchased additional equipment for $11.1 milion at the end of 2016, and this equipment was depreciated by $3.7 million per year in 2017, 2018, and 2019. Given Mydeco's tax rate of 35%, what impact would this additional purchase have had on Mydeco's net income in year 2015-20197 (Aasume the equipment is paid for out of cash and that Mydeco eams no interest on its cash balances.) Calculate the new net income below: (Round to one decimal place 2016 $ millions) Year Net Income Additional Depreciation Tax Savings New Net Income 3 $ s Enter any number in the edit fields and then click Check Answer Clear All Check Answer parts 3 remaining MacBook 19 BO 888 ga HE 4 FB Fd A & %23 # 3 $ 4 % 5 ) 0 2 6 7 8 9 9 of 20 (14 complete) Data Table 2015-2019 Financial Statement Data and Stock Price Data for Mydeco Corp. (All data as of fiscal year end; in $ millions) 2015 2016 2017 2018 Income Statement 400.2 Revenue 3675 420.6 513.8 Cost of Goods Sold (184.1) (175.8) (2013) (246.2) Gross Profit 216.1 191.7 219.3 267.6 Sales and Marketing (677) (67.9) (827) (104.0) Administration (59.9) (60.3) (57.8) (67.6) Depreciation & Amortization (253) (28.5) (32.4) (37.4) EBIT 63.2 35.0 46.4 58.6 Interest Income (Expense) (35.0) (33.2) (33.3) (35.6) Pretax Income 1.8 13.1 23.0 Income Tax (9.9) (0.6) (4.6) (8.1) Net Income 18.3 1.2 8.5 14.9 Shares Outstanding (millions) 54.1 54.1 54.1 54.1 Earnings per Share $0.34 $0.02 $0.16 $0.28 Balance Sheet 2015 2016 2017 2018 Assets Cash 48.3 63.8 83.8 74,5 Accounts Receivable 87.6 70.3 78.4 Inventory 322 31.8 31.9 Total Current Assets 168.1 165.0 182.0 184,8 Net Property, Plant & Equipment 246.1 245.9 305.5 3442 2019 604.6 (293.0) 311.6 (118.7) (79.8) (37.0) 76.1 (41.3) 34.8 (12.2) 22.6 54.1 $0.42 2019 28.2 69.4 27.9 81.0 84.8 37.2 203.0 351.4 Print Done MacBook 28 000 000 F4 F3 F5 00 F7 DI FB F9 1 ) 4 5 & 7 6 8 9 9 of 20 (14 complete) Data Table 246.1 366.3 780.5 245.9 366.3 777.2 305.5 366.3 853.8 344.2 366,3 895.3 351.4 366.3 920.7 20.4 6.7 27.1 501.5 528.6 251.9 780.5 16.6 7.3 23.9 501.5 525.4 251.8 7772 20.9 7.8 28.7 576.2 604.9 248.9 853.8 25.4 8.7 34.1 601.4 635.5 259.8 895.3 30.3 9.9 40.2 601.4 641.6 279.1 920.7 Net Property, Plant & Equipment Goodwill & Intangibles Total Assets Liabilities & Stockholders' Equity Accounts Payable Accrued Compensation Total Current Liabilities Long-Term Debt Total Liabilities Stockholders' Equity Total Liabilities & Stockholders' Equity Statement of Cash Flows Net Income Depreciation & Amortization Change in Accounts Receivable Change in Inventory Change in Pay. & Accrued Comp. Cash from Operations Capital Expenditures Cash from Investing Activ Dividends Paid Sale (or Purchase) of Stock PhD 2015 18.3 25.3 3.9% (2.9) 1.6 46.2 (25.8) (25.8) (5.9) 2016 1.2 28.5 18.2 0.4 (32) 45.1 (23.7) (23.7) (5,9) 2017 8.5 32.4 -0.9 3.9 4.8 48.7 (975) (97.5) (5.9) 2018 14.9 37.4 (8.1) (4.0) 5.4 45.6 (74.2) (742) (5.9) 2019 22.6 37.0 (6.4) (5.3) 6.1 54.0 (40.8) (40.8) (6.7) 747 99 Print Done MacBook 80 000 000 F4 DII FS F7 DD F9 4 5
