Alpha Resources has sales revenue of $800,000, operating costs of $400,000, and depreciation expense of $20,000. The company has $300,000 of outstanding bonds that pay 5% interest and it faces an average state-plus-federal tax rate of 40%. What is its net income?

Q: Pluto Minerals recently reported $15,800 of sales, $10,600 of operating costs other than…

A: EBIT (Earnings Before Interest and Taxes) is a financial metric that represents a company's…

Q: The Moore Enterprise has gross profit of $1,180,000 with amortization expense of $510,000. The…

A: Moore EnterpriseGross profit = $1,180,000Amortization expense = $510,000Selling and Administration…

Q: Ignacio, Inc., had after-tax operating income last year of $1,196,500. Three sources of financing…

A: Given, Net operating profit = $1,196,500 Mortgage bonds rate = 4% or 0.04 Unsecured bonds rate = 6%…

Q: The Anderson Corporation (an all-equity-financed firm) has a sales level of $300,000 with a 12…

A: Rate of return is the annual income earned in proportion to original investment.

Q: What is the EVA for Smith Falls? A)$305,000 B)$338,563 C)$220,188 D)$275,500 E)$255,500

A: EVA = NOPAT- WACC ( Total Assets - Current Liabilities ) WACC = ( Weight of Equity x Cost of Equity…

Q: Haricot Corporation and Pinto Corporation both have operating profits of $135 million. Haricot is…

A: For investors and analysts, operating profit is an essential indicator or tool because it provides…

Q: What is Chipotle’s TIE

A: TIE of a company means Times Interest Ratio or interest cover ratio of a company. It evaluates a…

Q: Diamond Company's cost of debt financing is 10%. Its tax rate is 35%. Diamond has $3,000,000 of…

A: The cost of debt is the interest expense to be paid on the debt. Since interest expenses is tax…

Q: Haricot Corporation and Pinto Corporation both have operating profits of $195 million. Haricot is…

A: Data given:Haricot Corporation:Operating Profits =$195 millionFinanced solely by equityPinto…

Q: Vonte Company has a 25 percent tax rate. Its total interest payment for the year just ended was…

A: Step 1:We have to calculate the interest tax shield. The formula of interest tax shield:Interest tax…

Q: Rogot Instruments makes fine violins and cellos. It has $1.7 million in debt outstanding, equity…

A: Solution: Given, Capital Structure : Debt capital = $1.7 Million Equity capital = $2.9 Million Total…

Q: Holly’s Art Galleries recently reported $7.9 million of net income. Its EBIT was $13 mil-lion, and…

A: EBIT = $13 million Net income = $7.9 million Tax rate = 21%

Q: Bolero Corporation has one long term loan (interest bearing debt) of $700,000 at an interest rate of…

A: Given: Particulars Amount Rate Debt $700,000 5.20% Equity $1,000,000 16.00%

Q: Shaye, Inc. has $260 million of debt outstanding at an interest rate of 12 percent. What is the…

A:

Q: The Yellow Corp has $650,000 of debt outstanding, and it pays an interest rate of 8% annually. Its…

A: EBITDA coverage is used to assess the company's ability to cover its debt obligations. EBITDA is…

Q: Rogot Instruments makes fine violins and cellos. It has ​$1.6 million in debt​ outstanding, equity…

A: WACC is weighted average cost of capital it is weighted average of cost of each capital security

Q: Waldorf Company has two sources of funds: long-term debt with a market and book value of $5,300,000…

A: NOPAT :— It stands for net operating profit after tax. It is calculated by deducting tax expense…

Q: 2. An overview of a firm's cost of debt To calculate the after-tax cost of debt, multiply the…

A: After tax cost of debt = Before tax cost of debt x (1-tax rate)henceTo calculate the after tax cost…

Q: Company B currently has $25 million in debt outstanding. In addition to 9.0% interest, it plans to…

A: Interest tax shield refers to the less tax paid due to the high cost of interest. To calculate the…

Q: For 2019, Gourmet Kitchen Products reported $21 million of sales and $17 million of operating costs…

A: Economic Value added - is one of the measures of economic profit. It is a type of value being…

Q: Maslyn Corp. has an EBIT of $985,000 per year that is expected to continue in perpetuity. The…

A: Value of the company consists of two components. One is debt or debentures held by the company and…

Q: Dickinson Company has $11,980,000 million in assets. Currently half of these assets are financed…

A: Capital structure refers to the mix of long-term financing sources a company uses to operate and…

Q: Nighthawk Steel, a manufacturer of specialized tools, has $4,700,000 in assets. Temporary current…

A: The Earnings after Taxes is a measure of net profitability for the company. The higher the earnings…

Q: Infrared Vision Inc. recently reported $15,500 of sales, $13,700 of operating costs other than…

A: Lets understand the basics.Net income after taxes gets calculated to know net amount remains after…

Q: abc corp recently reported 13000 of sales 5000 of operating costs other than depreciation and 4000…

A: Taxable income is that portion of gross income based on which the amount of tax payable to the…

Q: Ignacio, Inc., had after-tax operating income last year of $1,196,500. Three sources of financ by…

A: Economic value added refers to the profit at its minimum level after covering all the expenses of…

Q: Griffin's Goat Farm, Inc., has sales of $681,000, costs of $350,000, depreciation expense of…

A: The revenue that an entity earns after taking into consideration all the relevant expenses and taxes…

Q: Brown Office Supplies recently reported $4422 in Net Income. It had $9,000 of bonds outstanding that…

A: EBIT is the earning before interest and tax. It can be calculated by using equation below.

Q: For 2021, Bargain Basement Stores reported $11,500 of sales and $5,000 of operating costs (including…

A: The objective of the question is to calculate the Economic Value Added (EVA) for Bargain Basement…

Q: HHH Inc. reported $11,750 of sales and $7,025 of operating costs (including depreciation). The…

A: EVA means economic value added by business over the period. This is calculated by deducting weighted…

Q: What is the net income for this firm

A: Information Provided: Sales = $679,000 Costs = $341,000 Depreciation = $85,000 Interest expense =…

Q: Dickinson Company has $11,820,000 million in assets. Currently half of these assets are financed…

A:

Q: Acer Systems, a manufacturer of gaming consoles, has $5,520,000 in assets. Temporary current assets…

A: Earnings after taxesIt is the amount that remains after a company has paid off all of its operating…

Q: ABC Corp. has $50 in earnings before interest and taxes (EBIT), $200 in debt with an interest rate…

A: The tax shield is the reduction in income taxes that results from taking an allowable deduction from…

Q: Griffin's Goat Farm, Inc., has sales of $672,000, costs of $334,000, depreciation expense of…

A: A firm or individual's net income, commonly referred to as net profit, is a financial indicator that…

Q: The Moore Enterprise has gross profit of $1,140,000 with amortization expense of $490,000. The…

A: Cash flow is the money available from core business activities after making payment for  expenses…

Q: Rogot Instruments makes fine violins and cellos. It has $1.8 million in debt outstanding, equity…

A: Capital Structure :Debt capital = $1.78 MillionEquity capital = $2.9 MillionTotal Capital = $1.8 +…