Asset impairment charge is non-cash charge that is deductible for taxes. It is considered one-time in nature.· Income tax rate 25% (this is the same rate for income from all locations in this analysis). Create Income statement to determine if worthy of a purchase? Purchase:RevenuePassenger volume (in M)Spend per passengerCost as % of salesCOGSRentLaborOther variable costOther costs (in $M)HudsonDepreciationCapital expendituresWorking capital changeAsset impairment charge202040.0%10.0%12.0%2.0%(200)1,246.52,250.0 3,150.0 4,050.0 4,500.0$ 1.96 $ 1.98 $ 1.99 $ 2.00 $ 2.001,0502021e(127)(45)(110)40.0%10.0%14.0%4.0%1,3002022e(220)10(100)41.0%10.0%16.0%5.0%01,4502023e(250)(30)041.0%11.0%15.0%5.0%1,4502024e(250)(20)041.0%12.0%16.0%5.0%1,450(270)50

Income statement is one of the important statement to the company as from it company knows regarding…

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Business

Accounting

Create Income statement to determine if worthy of a purchase?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

Asset impairment charge is non-cash charge that is deductible for taxes. It is considered one-time in nature.
· Income tax rate 25% (this is the same rate for income from all locations in this analysis).

Create Income statement to determine if worthy of a purchase?

Purchase:
Revenue
Passenger volume (in M)
Spend per passenger
Cost as % of sales
COGS
Rent
Labor
Other variable cost
Other costs (in $M)
Hudson
Depreciation
Capital expenditures
Working capital change
Asset impairment charge
2020
40.0%
10.0%
12.0%
2.0%
(200)
1,246.5
2,250.0 3,150.0 4,050.0 4,500.0
$ 1.96 $ 1.98 $ 1.99 $ 2.00 $ 2.00
1,050
2021e
(127)
(45)
(110)
40.0%
10.0%
14.0%
4.0%
1,300
2022e
(220)
10
(100)
41.0%
10.0%
16.0%
5.0%
0
1,450
2023e
(250)
(30)
0
41.0%
11.0%
15.0%
5.0%
1,450
2024e
(250)
(20)
0
41.0%
12.0%
16.0%
5.0%
1,450
(270)
5
0

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