$44,533.57 $50,296.74 $64,442.70 $57,107.76 $52,392.44 $44,533.57 $50,296.74 $64

Question

$44,533.57

$50,296.74

$64,442.70

$57,107.76

$52,392.44

$44,533.57

$50,296.74

$64,442.70

$57,107.76

$52,392.44

5 points Save EmeryMining Inc. recently reported $167,500 of sales, $75,500 ofoperating costs other than depreciation, and $10,200 ofdepreciation. The company had $16,500 of outstanding bonds thatcarry a 7.25% interest rate, and its federal-plus-state income taxrate was 35%. How much was the firm's net income? The firm uses thesame depreciation expense for tax and stockholder reportingpurposes. $44,533.57 $50,296.74 $64,442.70 $57,107.76 $52,392.44

Explanation / Answer

NI = EBT * (1 - tax rate) = (Sales - Operating Costs - Depreciation- Interest) * (1 - tax rate) NI = (167,500 - 75,500 - 10,200 - .0725*16,500) * (1 - .35) =52,392.44 The answer is E.

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