Suppose you are given the following information for panola Bread sales $30,000; Cost $10,000;addition to retained earnings 4,365; dividends paid $485; interest expense $1,200; tax rate 30 percent. What is the amount of the depreciation expense? can you show the work?
can you show work

Addition to retained earnings is basically net income. Starting with this, we can calculate tax expense i.e 1,871 (4,365/0.7*0.3). As tax rate is 30% so net income left would be 70%. After determining tax amount we can easily calculate depreciation expense by reverse working which is as below:

Net income 4,365

Add:Tax 1,871

Add:Interest 1,200

Add: Cost 10,000

Less: Sales -30,000

Depreciation 12,564

Suppose you are given the following information for panola Bread sales $30,000; Cost $10,000;addition to retained earnings 4,365; dividends paid $485; interest expense $1,200; tax rate 30 percent. What is the amount of the depreciation expense? can you show the work?can you show work​

Respuesta :

Otras preguntas

Suppose you are given the following information for panola Bread sales $30,000; Cost $10,000;addition to retained earnings 4,365; dividends paid $485; interest expense $1,200; tax rate 30 percent. What is the amount of the depreciation expense? can you show the work?
can you show work