A not for profit, 501 (c)(3) organization has $800,000 in assets, anEBIT of $100,000. The current interest rate is 8% and the current taxrate is 25%. Given it has financed its assets with 80% equity what isits profit after taxes and interest, and its ROE?Profit__________________ROE___________________

A not for profit, 501 (c)(3) organization has $800,000 in assets, anEBIT of $100,000. The current interest rate is 8% and the current taxrate is 25%. Given it has financed its assets with 80% equity what isits profit after taxes and interest, and its ROE?ProfitROE_

Financial Management: Theory & Practice

16th Edition

ISBN:9781337909730

Author:Brigham

Publisher:Brigham

Chapter2: Financial Statements, Cash Flow,and Taxes

Section: Chapter Questions

Problem 4P: Nicholas Health Systems recently reported an EBITDA of $25.0 million and net income of $15.8...

See similar textbooks

Similar questions

Instructions Consider an organization that has Earnings Before Tax of $100,000. Assume amortization expense for this organization is zero, and it is in the 30% tax bracket. Answer the following questions: 1. What is the cash flow? 2. Now assume amortization is $50,000. Does the cash flow change? If so, why and by how much? Requirements Your submission should include a single Microsoft Word document or pdf containing your response to the discussion question. S
FGH Corporation had the following in 2021: Sales P 3.4M; Cost of sales P 1.2M; Admin expense P 0.3M; Selling expenses P .5M; other taxable income from operations P .1M. What is deductible expense if the company uses OSD?* a. 920,000 b. 1,360,000 c. 880,000 d. 800,000 Using the problem above, what is the income tax payable?* a. 330,000 b. 375,000 c. 575,000 d. 525,000
1. (a) A corporation has $25,000 of income from its business operations, $20,000 of net capital gains, and $5,000 of dividend income. If it contributes $25,000 to charity, what's it charitable deduction? What's its ("real") taxable income? (b) How do your answers to (a) change if the corporation has a $4,000 net operating loss from a prior year carried forward into this one? (c) How do your answers to (a) change if the corporation has a $1,000 net capital loss from a future year carried back into this one? (d) How do your answers to (a) change if the corporation has a $1,000 net capital loss from a past year carried forward into this one?
A non-profit organization received S80,000 as the entrance fee of a new member. If 10% of the fee has to be capitalized, what is the amount of fee needs to be shown in the income and expenditure account? O a. S72,000 O b. $82,000 O . S80,000 O d. $62,000
Accounting 1. In 2022, a corporation earns $65,000 from its business operations and has $10,000 of dividend income. It donates $12,000 to charity. Show how you determine taxable income.
For 2020, Garden Corporation has 800.000 of gross profit from its sales and $410,000 of operating expenses. Garden makes $90,000 of cash charitable contributions during 2020 Inot inchuded in the other amounts). How much of these contributions can it deduct for 2020? (Note that this is for 2020, ie, 25%) O $75.000 O $97.500 $22.500 O $90.000
Urgent Need (Explanation Require) Multiple Choice Questions. 1. Similar to the example given in class, assume that a corporation has $500 of cash revenue and $300 of cash expenses. Therefore the corporation has $200 of taxable income. The corporation pays taxes at the 40% income tax rate (i.e., all of the $200 of taxable income will be taxed at 40%). The corporation plans to pay any cash left over after the payment of income taxes to the stockholders. If the stockholders pay taxes at the 20% tax rate (i.e., any dividends they receive will be taxed at 20%), how much income tax (both corporate and individual) will be paid? A. $82 B. $104 C. $112 D. $116 E. $120 F. $140 2. A project requires an initial investment of $10 million and produces a single positive cash flow in one year. The opportunity cost of capital for the project is 8%. The expected return for the project is X%. Which of the following statements is true? A. The project will create value for the owner only if the expected…
! Required Information [The following information applies to the questions displayed below.] Arndt, Incorporated reported the following for 2024 and 2025 ($ in millions): Revenues Expenses Pretax accounting income (income statement) Taxable income (tax return) Tax rate: 25% 2024 $ 942 798 $ 144 $10 2025 $ 1,034 a. Expenses each year include $60 million from a two-year casualty insurance policy purchased in 2024 for $120 million. The cost is tax deductible in 2024. 854 $ 180 $ 214 b. Expenses include $2 million insurance premiums each year for life insurance on key executives. c. Arndt sells one-year subscriptions to a weekly Journal. Subscription sales collected and taxable in 2024 and 2025 were $61 million and $77 million, respectively. Subscriptions included in 2024 and 2025 financial reporting revenues were $55 million ($38 million collected in 2023 but not recognized as revenue until 2024) and $61 million, were respectively. Hint. View this as two temporary differences-one…
a calendar-year C Corporation, is considering investing in a business expenditure with a cost of $10,000. If $8,000 of the cost of the expenditure can be used as a tax credit rather than a tax deduction of $10,000 and the marginal tax rate is 21%, how much additional tax savings would the expenditure generate as a result of the tax credit relative to the tax deduction? a. $2,000 b. $8,000 c. $5,900 d. $2,100
! Required information [The following information applies to the questions displayed below.] Arndt, Incorporated reported the following for 2024 and 2025 ($ in millions): Revenues Expenses Pretax accounting income (income statement) Taxable income (tax return) Tax rate: 25% 2024 $ 940 796 $ 144 $ 104 2025 $ 1,032 a. Expenses each year include $58 million from a two-year casualty insurance policy purchased in 2024 for $116 million. The cost is tax deductible in 2024. 852 $ 180 $ 214 b. Expenses include $2 million insurance premiums each year for life insurance on key executives. c. Arndt sells one-year subscriptions to a weekly journal. Subscription sales collected and taxable in 2024 and 2025 were $59 million and $75 million, respectively. Subscriptions included in 2024 and 2025 financial reporting revenues were $53 million ($36 million collected in 2023 but not recognized as revenue until 2024) and $59 million, respectively. Hint. View this as two temporary differences-one reversing…
35. A domestic corporation has the following income and expenses for 2021 taxable year: Gross sales P20,000,000 Cost of sales 10,000,000 3,800,000 48,0000,000 Operating expenses Assets How much is the income tax due? a. P1,240,000 b. P1,550,000 36. ABC Corporation, a domestic corporation has the following income and expenses for 2021 taxable year: Gross sales Cost of sales Operating expenses c. P1,860,000 d. P3,000,000 How much is the income tax due? a. P600,000 b. P700,000 P20,000,000 10,000,000 6,500,000 c. P800,000 d. P875,000
Question: A company has a gross income of $2,500,000 and has $500,000 of business expenses. The company also has $100,000 of depreciation expense and $50,000 of interest expense. The company also paid $25,000 of state taxes and $10,000 of charitable contributions. Calculate the company's taxable income.