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(Solved): The firm of Beryl Agatha had sales of $20, 000 in 2020. The cost of goods sold was $13, 000, general ...



The firm of Beryl Agatha had sales of $20, 000 in 2020. The cost of goods sold was $13, 000, general and administrative expenses were $2, 000, interest expenses were $1, 000, and depreciation was $2, 000. Working capital increased by $400 and capital expenditures were $1,800. The firm’s tax rate is 35 percent. [15 marks] a) What are the firm’s earnings before interest and taxes? b) What is the firm’s net income? c) What is the firm’s cash flow from operating activities?

 



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Solution : Sales $20,000 Cost of goods sold $13,000 General & Admin expenses $2,000 Depreciation $2,000 a) Earnings before interest and taxes (EBIT) $
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