In the four cases, assume the company retains all after-tax profits (i.e., no distributions to owners). Calculate:

• Profits before and after taxes
• Change in cash
• EBITD
• Coverage ratio

I-A

REVENUE 400,000

OPERATING COSTS 250,000

DEPRECIATION 25,000

INTEREST 20,000

PROFITS TAX 20%

I-B

REVENUE 400,000

OPERATING COSTS 250,000

DEPRECIATION 50,000

INTEREST 20,000

PROFITS TAX 20%

II-A

REVENUE 400,000

OPERATING COSTS 250,000

DEPRECIATION 25,000

INTEREST 20,000

PROFITS TAX 30%

II-B

REVENUE 400,000

OPERATING COSTS 250,000

DEPRECIATION 50,000

INTEREST 20,000

PROFITS TAX 30%