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a. Britton String Corp. manufactures specialty strings for musical instruments and tennis racquets. Its most recent sales were $880 million; operating costs (excluding depreciation) were equal to 85% of sales; net fixed assets were $300 million; depreciation amounted to 10% of net fixed assets; interest expenses were $22 million; the state-plus-federal corporate tax rate was 25%; and it paid 40% of its net income out in dividends. Given this information, construct its income statement. Also calculate total dividends and the addition to retained earnings. Report all dollar figures in millions.
The input information required for the problem is outlined in the "Key Input Data" section below. Using this data and the balance sheet above, we constructed the income statement shown below.
Key Input Data for Britton String Corp.				2023
(Millions of dollars)
Sales Revenue				$880
Expenses (excluding depreciation) as a percent of sales				85.0%
Net fixed assets				$300
Depr. as a % of net fixed assets				10.0%
Tax rate				25.0%
Interest expense				$22
Dividend Payout Ratio				40%
Britton String Corp.: Income Statement				2023
(Millions of dollars)
Sales
Operating costs excluding depreciation
EBITDA
Depreciation (Cumberland has no amortization charges)
EBIT
Interest expense
EBT
Taxes (25%)
Net income
Common dividends
Addition to retained earnings