Question
6.value: 2.00 points Butterfly Tractors had $17.00 million in sales last year. Cost of goods sold was $8.60 million, depreciation expense was $2.60 million, interest
6.value: 2.00 points Butterfly Tractors had $17.00 million in sales last year. Cost of goods sold was $8.60 million, depreciation expense was $2.60 million, interest payment on outstanding debt was $1.60 million, and the firms tax rate was 35%. a. What were the firms net income and net cash flow? (Enter your answers in millions rounded to 2 decimal places.) Net income $ million Net cash flow $ million b. What would happen to net income and cash flow if depreciation were increased by $1.60 million? (Input all amounts as positive values. Enter your answers in millions rounded to 2 decimal places.) Net income by $ million Cash flow by $ million c. Would you expect the change in income and cash flow to have a positive or negative impact on the firms stock price? Positive Negative d. What would be the impact on net income if depreciation was $1.60 million and interest expense was $2.60 million? Increase Decrease No change e. What would be the impact on cash if depreciation was $1.60 million and interest expense was $2.60 million? Increase Decrease No change
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