Information needed for questions
See Table 2.5 m showing financial statement data and stock price data for Mydeco Corp. Suppose Mydeco had purchased additional equipment for $11.8 million at the end of 2016, and this equipment was depreciated by $3.9 million per year in 2017, 2018, and 2019 Given Mydeco's tax rate of 359 %, what impact would this addtional purchase have had on Mydeco's net income in years 2016-2019? (Assume the equipment is paid for out of cash and that Mydeco earns no interest on its cash balances) Calculate the new net income below. (Round to one decimal place) (millions) Year 2016 2017 2018 2019 Net Income S $ Additional Depreciation Tax Savings S S New Net Income 2015-2019 Financial Statement Data and Stock Price Data for Mydeco Corp. (All data as of fiscal year end; in $ millions) 2016 365 3 (171.4) 193.9 (68.0) (53.0) (28 6) 39.3 (31.6) 7.7 Income Statement Revenue Cost of Goods Sold Gross Profit Sales and Marketing 2015 403.5 (185.1) 2017 2018 512.3 (245.0) 267.3 (105.1) (66.5) (37.3) 58.4 (36.2) 22.2 (7.8) 14.4 55.6 S0.26 2019 600.9 (292.9) 308.0 (118.5) (78.1) (40.4) 710 (40.2) 30.8 (10.8) 20.0 424.8 (208.9) 215.9 (82 3 (60 9) (33 5) 39.2 (31.9) 7.3 (2.6) 47 55.6 S0.08 218.4 (65 8) (58 9) (27 6) 66.1 (33 2) 32.9 (11.5) 21.4 55.6 S0 38 Administration Depreciation & Amortization EBIT Interest Income (Expense) Pretax Income Income Tax (2.7) 5.0 55.6 S0.09 Net Income Shares Outstanding (millions) Earninos per Share 55.6 S0 36 Balance Sheet 2015 2019 2017 2018 2016 Assets 78.3 88.1 36.1 202.5 348 2 363.4 914 1 80.9 69.8 28.8 179.5 313.1 363 4 856.0 70.9 78.8 30.1 179.8 348.2 363.4 891 4 Cash Accounts Receivable Inventory Total Current Assets Net Property, Plant & Equipment Goodwill & Intangibles Total Assets Liabilities & Stockholders' Equity Accounts Payable Accrued Compensation Total Current Labilities Long-Term Debt Total Liabilities Stockholders Eauitv 50.1 87.7 34.4 172 2 244 5 363.4 780 1 70.0 70.7 31 3 172.0 2452 363 4 780 6 17.9 7.3 25.2 496 3 521.5 259.1 20.5 6.6 21.6 6 1 25.7 7.7 32.8 8 8 41.6 595.7 33.4 595.7 27.7 570 8 598.5 257.5 27 1 496 3 523 4 256.7 629.1 262.3 637.3 276.8 2019 20.0 40.4 (9.3) (6.0) 8 2 53.3 (40.2) 2017 4.7 33.5 0.9 25 2.5 44 (101.9) (101.9) (5 8) 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 Debt Issuance (Pay Down) Cash from Financing Activ Change in Cash My deco Stock Price 2018 14.4 37.3 (9.0) (1.3) 5.7 2016 2015 21.4 27.6 5.0 28 6 17.0 31 (1.9) 518 (26.1) (26.1) (58) 3.9 (2 9) 2.4 52 4 (24.2) (24.2) (5.8) 47.1 (76.2) (76.2) (5.8) (40.2) (5.7) 24.9 19.1 (10.0) S8 02 74.5 68.7 10.9 $4.86 (57 5 8 (5.8) 22.4 $8.66 7.4 19.9 59 74 $3.95
