Question
Sneaker Inc. has come to your financial firm for counsel. Their tax rate is 40%. Income Statement Cost of Goods Sold 300 Interest Expense 30
Sneaker Inc. has come to your financial firm for counsel. Their tax rate is 40%. Income Statement
| Cost of Goods Sold | 300 |
| Interest Expense | 30 |
| Operating Expense (excluding depreciation) | 115 |
| Sales | 610 |
| Tax | ___ |
Balance Sheet
| Accounts Payable | 35 |
| Accounts Receivable | 65 |
| Accruals | 30 |
| Accumulated Depreciation | (175) |
| Cash | 35 |
| Common Stock | 120 |
| Fixed Assets (gross) | 390 |
| Inventory | 135 |
| Long Term Debt | 200 |
| Retained Earnings | 65 |
1. What was Sneaker Inc.'s earnings before interest & tax (EBIT)?
| a. | $185 |
| b. | $195 |
| c. | $160 |
| d. | $215 |
| e. | $120 |
2. Sneaker Inc.'s tax liability?
| a. | $48 |
| b. | $60 |
| c. | $55 |
| d. | $62 |
| e. | $66 |
3. Sneaker Inc. Net Income?
| a. | $72 |
| b. | $83 |
| c. | $99 |
| d. | $93 |
| e. | $76 |
4. Sneaker Inc. Total Current Assets?
| a. | $450 |
| b. | $240 |
| c. | $625 |
| d. | $235 |
| e. | $490 |
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Essentials Of Investments
Authors: Zvi Bodie, Alex Kane, Alan J. Marcus
8th Edition
0077606779, 978-0697789945
