Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Complete the income statement and then calculate the OCF. What is the depreciation tax shield? Consider the following information. Complete the income statement and then

Complete the income statement and then calculate the OCF. What is the depreciation tax shield?

image text in transcribed Consider the following information. Complete the income statement and then calculate the OCF. What is the depreciation tax shield? \begin{tabular}{|l|r|} \hline Input area: & \\ \hline Sales & $704,600 \\ \hline Variable cost & $527,300 \\ Depreciation & $82,100 \\ Tax rate & 22% \\ \hline \end{tabular} (Use cells A6 to B10 from the given information to complete this question.) \begin{tabular}{l} Output area: \\ \hline Sales \\ Variable costs \\ Depreciation \\ EBT \\ Taxes \\ Net Income \\ OCF \\ Depreciation tax shield \\ \hline \end{tabular} Consider the following information. Complete the income statement and then calculate the OCF. What is the depreciation tax shield? \begin{tabular}{|l|r|} \hline Input area: & \\ \hline Sales & $704,600 \\ \hline Variable cost & $527,300 \\ Depreciation & $82,100 \\ Tax rate & 22% \\ \hline \end{tabular} (Use cells A6 to B10 from the given information to complete this question.) \begin{tabular}{l} Output area: \\ \hline Sales \\ Variable costs \\ Depreciation \\ EBT \\ Taxes \\ Net Income \\ OCF \\ Depreciation tax shield \\ \hline \end{tabular}

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Essentials Of Managerial Finance

Authors: Scott Besley, Eugene F. Brigham

12th Edition

0030258723, 9780030258725

More Books

Students also viewed these Finance questions