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The Bellcamp Soup Company uses the straight-line depreciation for financial reporting purposes and accelerated depreciation for tax purposes. The companys tax rate is 35%. The
- The Bellcamp Soup Company uses the straight-line depreciation for financial reporting purposes and accelerated depreciation for tax purposes. The companys tax rate is 35%. The following information is extracted from the companys financial statements (amounts in $ millions).
| Year 10 | Year 11 |
Depreciation Expense | 175.9 | 184.1 |
Net Income | 4.4 | 401.5 |
Net Plant, Property and Equipment | 1,717.7 | 1,790.4 |
Total Assets | 4,115.6 | 4,149.0 |
Retained Earnings | 1,653.3 | 1,912.6 |
Deferred Tax Liability--Plant (from Notes) | 184.6 | 175.6 |
As an analyst, you have decided to adjust the companys financial statements to reflect the conversion from straight-line to accelerated depreciation. Use the information provided to calculate the adjusted values for Year 11 of the following:
a. | Net Plant, Property and Equipment. |
b. | Retained Earnings. |
c. | Net Income. |
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