Jake Entertainment Corporation has three segments with revenue, operating income, and depreciation and amortization information (in millions) as follows:SegmentRevenueOperatingIncomeDepreciationand AmortizationFilm$5,000 $1,500 $525 Theme Park1,000 320 112 Video Game500 175 53 Totals$6,500 $1,995 $690 The EBITDA as a percent of revenue for the Video Game segment isa.24%b.4%c.54%d.46%

EBITDA is considered as net income with interest, taxes depreciation. It is used to analyzed profitability.EBITDA of Video game = Operating income + Non-cash expense = 175 + 53 = 228 EBITDA as a percent of revenue for the Video Game segment = EBITDA / Revenue = 228 / 500 = 0.456 or 46% So the correct answer is d.46%.

Answered: Jake Entertainment Corporation has…

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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Jake Entertainment Corporation has three segments with revenue, operating income, and depreciation and amortization information (in millions) as follows:

Segment	Revenue	Operating Income	Depreciation and Amortization
Film	$5,000	$1,500	$525
Theme Park	1,000	320	112
Video Game	500	175	53
Totals	$6,500	$1,995	$690

The EBITDA as a percent of revenue for the Video Game segment is

a.24%

b.4%

c.54%

d.46%

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