Question
The following financial data have been furnished by A Ltd. And B Ltd. for the year ended 31 st March 2018: Particulars A Ltd. B
The following financial data have been furnished by A Ltd. And B Ltd. for the year ended 31st March 2018:
| Particulars | A Ltd. | B Ltd. |
| Operating Leverage | 3 : 1 | 4 : 1 |
| Financial Leverage | 2 : 1 | 3 : 1 |
| Interest charges per annum | Rs.1,200,000 | Rs.1,000,000 |
| Corporate tax rate | 40% | 40% |
| Variable cost as % of sales | 60% | 50% |
Required:
Prepare Income statements of the two companies. Also comment on the financial position and structure of the two companies.
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Income Tax Fundamentals 2013
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
31st Edition
9781285586618
