2. Building an income statement. Draiman, Inc., has sales of $795,000, costs of
ID: 2659505 • Letter: 2
Question
2. Building an income statement. Draiman, Inc., has sales of $795,000, costs of $345,000, depreciation expense of $76,000, interest expense of $41,000, and a tax rate of 35 percent. What is the net income for this firm?
3. Dividends and retained earnings. Suppose the firm in problem 2 paid out $56,000 in cash dividends. What is the addition to retained earnings?
4. Per-share earnings and dividends. Suppose the firm in problem 3 had 60,000 shares of common stock outstanding. What is the earning per share, or EPS, figure? What is the dividends per share figure?
Building an income statement. Draiman, Inc., has sales of $795,000, costs of $345,000, depreciation expense of $76,000, interest expense of $41,000, and a tax rate of 35 percent. What is the net income for this firm? Dividends and retained earnings. Suppose the firm in problem 2 paid out $56,000 in cash dividends. What is the addition to retained earnings? Per-share earnings and dividends. Suppose the firm in problem 3 had 60,000 shares of common stock outstanding. What is the earning per share, or EPS, figure? What is the dividends per share figure?Explanation / Answer
2. Building an income statement. Draiman, Inc., has sales of $795,000, costs of
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