Can someone please tell me if I'm on the right track, and complete the missing cells by completing the forumulas? Thank you. Sales$55,000,000Less:$ 38,400,0005,700,000Cost of goods soldSelling and administrative expenseInterest expenseIncome before taxes1,000,00045,100,0009,900,0001,980,000$ 7,920,000Less income taxesNet incomeOther pertinent information for 2020 follows:Total assets$ 97,000,0003,200,000Noninterest-bearing current liabilitiesRequired rate of return on invested capital10%alculate NOPAT, invested capital, and ROI for LaundryMate Products.Income tax rate =$ 1,980,000: $ 9,900,00020%NOPAT = $ 9,900,000 +[ $ 1,000,000 xInvested capital =$ 97,000,000$ 3,200,000= $93,800,000ROI =0.00%$ 93,800,000 Consider the following after you have completed the requirements of E12-8 aboveSuppose LaundryMate Products had $11,000,000 of fully depreciated equipment ofwhich it decided to dispose. Calculate ROl after the disposal of the equipment.NOPAT =+ [x (Adjusted invested capital =New ROI =What incentives might a manager have to dispose of assets?

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Business

Accounting

What incentives might a manager have to dispose of assets?

Entrepreneurial Finance

6th Edition

ISBN:9781337635653

Author:Leach

Publisher:Leach

Chapter14: Security Structures And Determining Enterprise Values

Section: Chapter Questions

Problem 8EP

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Question

Can someone please tell me if I'm on the right track, and complete the missing cells by completing the forumulas? Thank you.

Sales
$55,000,000
Less:
$ 38,400,000
5,700,000
Cost of goods sold
Selling and administrative expense
Interest expense
Income before taxes
1,000,000
45,100,000
9,900,000
1,980,000
$ 7,920,000
Less income taxes
Net income
Other pertinent information for 2020 follows:
Total assets
$ 97,000,000
3,200,000
Noninterest-bearing current liabilities
Required rate of return on invested capital
10%
alculate NOPAT, invested capital, and ROI for LaundryMate Products.
Income tax rate =
$ 1,980,000
: $ 9,900,000
20%
NOPAT = $ 9,900,000 +[ $ 1,000,000 x
Invested capital =
$ 97,000,000
$ 3,200,000
= $93,800,000
ROI =
0.00%
$ 93,800,000

Consider the following after you have completed the requirements of E12-8 above
Suppose LaundryMate Products had $11,000,000 of fully depreciated equipment of
which it decided to dispose. Calculate ROl after the disposal of the equipment.
NOPAT =
+ [
x (
Adjusted invested capital =
New ROI =
What incentives might a manager have to dispose of assets?

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