Question
Use the following information to calculate ATCF: Gross Sales are $1,250,000, returns and allowances are 5% of gross sales, CGS are 20% of gross Sales,
Use the following information to calculate ATCF: Gross Sales are $1,250,000, returns and allowances are 5% of gross sales, CGS are 20% of gross Sales, administrative and selling expenses are 10% of gross sales and the marginal tax rate is 25%. The basis of the machinery that is subject to depreciation is $150,000 and the MACRS depreciation table rates are: 20%, 32%, 19.2%...for years 1-3 respectively. Are these expenses on the income statement used in finance: the Interest Expense is $30,000 and Dividend Expense is $15,000? Show the income statement for years 1 through 3.
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