Answer:
$3,190
Explanation:
Incremental net income before tax = Incremental gross profit - Incremental SG&A expenses
= $5,000 - $400
= $4,600
Incremental net income after taxes = Incremental net income before tax * (1 - Tax rate)
Incremental net income after taxes = $4,600 * (1 - 0.35)
Incremental net income before tax = $4,600 * 0.65
Incremental net income before tax = $2990
Incremental cash flow = Incremental income after taxes + Depreciation
Incremental cash flow = $2,990 + $200
Incremental cash flow = $3,190
Answer:
Explanation:
It is given that there is a liability to creditors of 6,500
Total assets = Total liability + Shareholder's equity
a) Shareholder's equity = Total assets - Total liability = 10,250 - 6,500 = 3,750
b) Shareholder's equity = Total assets - Total liability = 5,900 - 6,500 = -600
<span>The interest rate can drastically change the total amount paid to the lender</span>
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