During 2018, Raines Umbrella Corp. had sales of $745,000. Cost of goods sold, administrative and selling expenses, and depreciation expenses were $456,000, $100,000, and $145,500, respectively. In addition, the company had an interest expense of $72,600 and a tax rate of 21 percent. (Ignore any tax loss carryforward provisions and assume interest expense is fully tax deductible.)

Question

Deon Miles

Business

25 August, 08:48

During 2018, Raines Umbrella Corp. had sales of $745,000. Cost of goods sold, administrative and selling expenses, and depreciation expenses were $456,000, $100,000, and $145,500, respectively. In addition, the company had an interest expense of $72,600 and a tax rate of 21 percent. (Ignore any tax loss carryforward provisions and assume interest expense is fully tax deductible.)

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Lola Marsh · Answer 1

net loss 29,100

operating cahs flow 116,400

Q: net income/loss and cashflow

Explanation:

net income:

sales 745,000

COGS (456,000)

selling expenses (100,000)

depreciation expense (145,500)

interest expense (72,600)

income before taxes (29,100)

income tax expense 0

As we ignore carryforward provision we end with a net loss of 29,100

Cash flow:

net loss (29,100)

non-monetary terms

depreciation 145,500

operating cahs flow 116,400