See Table 2.5 showing financial statement data and stock price data for Mydeco Corp. Suppose Mydeco had purchased additional equipment for $11 million 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 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 Net Income Additional Depreciation Tax Savings New Net Income 2015 2015-2019 Financial Statement Data and Stock Price Data for Mydeco Corp. (All data as of fiscal year end; in $ millions) Income Statement 2016 2017 2018 Revenue 407.3 362.4 424.2 508.2 Cost of Goods Sold (192.0) (176.4) (205.3) (245.2) Gross Profit 215.3 186.0 218.9 263.0 Sales and Marketing (67.6) (65.7) (83.0) (98.1) Administration (59.6) (57.3) (60.9) (68.2) Depreciation & Amortization (26.2) (26.0) (33.0) (40.3) EBIT 61.9 37.0 42.0 56.4 Interest Income (Expense) (32.9) (33.2) (33.6) (37.4) Pretax Income 29.0 3.8 8.4 Income Tax (10.2) (1.3) (6.7) Net Income 18.8 2.5 5.5 12.3 Shares Outstanding (millions) 55.9 55.9 55.9 55.9 Earnings per Share $0.34 $0.04 $0.10 $0.22 Balance Sheet 2015 2016 2017 2018 Assets Cash 49.5 64.7 74.4 68.6 Accounts Receivable 88.7 69.4 70.9 75.8 Inventory 32.7 29.7 29.8 31.8 Total Current Assets 170.9 163.8 175.1 176.2 Net Property. Plant & Equipment 248.9 248.3 312.4 347.8 2019 606.1 (291.1) 315.0 (124.1) (78.0) (38.0) 74.9 (39.8) 35.1 (12.3) 22.8 55.9 $0.41 2019 19.0 (2.9) 73.4 86.9 36.5 196.8 350.9 365.1 784.9 365.1 777.2 365.1 852.6 365.1 889.1 365.1 912.8 22.8 7.1 20.1 7.3 27.4 499.4 526.8 258.1 784.9 16.7 6.9 23.6 499.4 523.0 254.2 777.2 29.9 576.0 605.9 246.7 852.6 27.1 7.8 34.9 601.1 636.0 253.1 889.1 30.6 10.7 41.3 601.1 642.4 270.4 912.8 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 Debt Issuance (Pay Down) 2019 22.8 38.0 (11.1) (4.7) 2015 18.8 26.2 3.9 (2.9) 1.9 47.9 (24.3) (24.3) (5.3) 2016 2.5 26.0 19.3 3.0 (3.8) 47.0 (26.5) (26.5) (5.3) 2017 5.5 33.0 -1.5 (0.1) 6.3 43.2 (104.8) (104.8) (5.3) 2018 12.3 40.3 (4.9) (2.0) 5.0 50.7 (76.3) (76.3) (5.3) 6.4 51.4 (39.4) (39.4) (7.2) 76.6 25.1 (5.3) Cash from Financing Activ. Change in Cash Mydeco Stock Price (5.3) 18.3 $7.02 15.2 71.3 9.7 $4.46 19.8 (5.8) $8.32 (7.2) 4.8 $12.23 $3.04 See Table 2.5 showing financial statement data and stock price data for Mydeco Corp. Suppose Mydeco had purchased additional equipment for $11 million 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 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 Net Income Additional Depreciation Tax Savings New Net Income 2015 2015-2019 Financial Statement Data and Stock Price Data for Mydeco Corp. (All data as of fiscal year end; in $ millions) Income Statement 2016 2017 2018 Revenue 407.3 362.4 424.2 508.2 Cost of Goods Sold (192.0) (176.4) (205.3) (245.2) Gross Profit 215.3 186.0 218.9 263.0 Sales and Marketing (67.6) (65.7) (83.0) (98.1) Administration (59.6) (57.3) (60.9) (68.2) Depreciation & Amortization (26.2) (26.0) (33.0) (40.3) EBIT 61.9 37.0 42.0 56.4 Interest Income (Expense) (32.9) (33.2) (33.6) (37.4) Pretax Income 29.0 3.8 8.4 Income Tax (10.2) (1.3) (6.7) Net Income 18.8 2.5 5.5 12.3 Shares Outstanding (millions) 55.9 55.9 55.9 55.9 Earnings per Share $0.34 $0.04 $0.10 $0.22 Balance Sheet 2015 2016 2017 2018 Assets Cash 49.5 64.7 74.4 68.6 Accounts Receivable 88.7 69.4 70.9 75.8 Inventory 32.7 29.7 29.8 31.8 Total Current Assets 170.9 163.8 175.1 176.2 Net Property. Plant & Equipment 248.9 248.3 312.4 347.8 2019 606.1 (291.1) 315.0 (124.1) (78.0) (38.0) 74.9 (39.8) 35.1 (12.3) 22.8 55.9 $0.41 2019 19.0 (2.9) 73.4 86.9 36.5 196.8 350.9 365.1 784.9 365.1 777.2 365.1 852.6 365.1 889.1 365.1 912.8 22.8 7.1 20.1 7.3 27.4 499.4 526.8 258.1 784.9 16.7 6.9 23.6 499.4 523.0 254.2 777.2 29.9 576.0 605.9 246.7 852.6 27.1 7.8 34.9 601.1 636.0 253.1 889.1 30.6 10.7 41.3 601.1 642.4 270.4 912.8 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 Debt Issuance (Pay Down) 2019 22.8 38.0 (11.1) (4.7) 2015 18.8 26.2 3.9 (2.9) 1.9 47.9 (24.3) (24.3) (5.3) 2016 2.5 26.0 19.3 3.0 (3.8) 47.0 (26.5) (26.5) (5.3) 2017 5.5 33.0 -1.5 (0.1) 6.3 43.2 (104.8) (104.8) (5.3) 2018 12.3 40.3 (4.9) (2.0) 5.0 50.7 (76.3) (76.3) (5.3) 6.4 51.4 (39.4) (39.4) (7.2) 76.6 25.1 (5.3) Cash from Financing Activ. Change in Cash Mydeco Stock Price (5.3) 18.3 $7.02 15.2 71.3 9.7 $4.46 19.8 (5.8) $8.32 (7.2) 4.8 $12.23 $3.04