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CaHeK987 [17]
3 years ago
13

Beach Front Industries has sales of $589000, costs of $280000, depreciation expense of $37000, interest expense of $17000, and a

tax rate of 32 percent. The firm paid $59000 in cash dividends. What is the addition to retained earnings?
A. $76,320B. $81,700C. $95,200D. $121,680E. $103,460
Business
1 answer:
sladkih [1.3K]3 years ago
5 0

Answer:

addition to retained earnings is $114400

Explanation:

Given data

sales = $589000

costs = $280000

depreciation expense = $37000

interest expense = $17000

tax rate = 32 percent

cash dividends =  $59000

to find out

the addition to retained earnings

solution

first we calculate the profit before tax that is

profit before tax = sale - cost - depreciation - interest

profit before tax =  589000 - 280000 t - 37000 - 17000

profit before tax =  589000 - 280000  - 37000 - 17000

profit before tax is $255000

now calculate profit after tax that is

profit after tax = profit before tax × (1- tax rate )

profit after tax =  255000 × (1- 32% )

profit after tax is $173400

so

addition to retained earnings is

= profit after tax - dividend

addition to retained earnings = 173400 - 59000

addition to retained earnings is $114400

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Here are the options to this questions:

  1. Price gouging laws reduce shortages after a disaster by keeping prices low.
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Answer:

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YTM_{sm} =\cfrac{PMT+\cfrac{FV-PV}n}{\cfrac{FV+PV}2}

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RATE(60,50,1050,1000)*2

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