During the year, the XYZ Company paid $300,000 in interest. The company is in the 25% tax bracket. It paid off $175,000 in notes payable and issued an additional $400,000 in long-term debt. The firm paid $125,000 in dividends and bought back $100,000 in common stock. It also increased its short-term investments by $60,000. Based on the information above, calculate the FCF for XYZ Company. O $1,072,500 O $285,000 O $1,085,000 $260,000

Q: The Pawlson Company's year-end balance sheet is shown below. Its cost of common equity is 14%, its…

A: WACC stands for Weighted Average Cost of Capital, which is defined as the computation of the cost of…

Q: The Paulson Company’s year-end balance sheet is shown below. Its cost of commonequity is 14%, its…

A: cost of common equity = 14.00% before tax cost of debt = 10% Tax rate = 40% Total debt = $1167…

Q: Calculate Paulson's WACC using market-value weights. Do not round intermediate calculations. Round…

A: WACC: It is the company's average cost of capital and is calculated by the total of all individual…

Q: This year, FCF Inc. has earnings before interest and taxes of $10,180,000, depreciation expenses of…

A: Free cash flow = EBIT*(1-tax) + Deprication - capital expenditure - Increase in Working capital

Q: Ignacio, Inc., had after-tax operating income last year of $1,196,500. Three sources of financing…

A: Given, Net operating profit = $1,196,500 Mortgage bonds rate = 4% or 0.04 Unsecured bonds rate = 6%…

Q: The Malia  Corporation had sales in 2019 of $65 million, total asswets of $42 million, and total…

A: Given:Sales=$65 million in year 2019Assets = $42 millionOperating profit margin = 12%Liabilities =…

Q: The Sunflower Corporation reported the following information from their financial statements:…

A: Dollar amount of taxes the firm had to pay to the taxation office is the amount that is applicable…

Q: The financial breakeven point of Soillnc. is P90,000,while the tax rate applicable to the company is…

A: The financial breakeven can be calculated by using this equation EBITFinBE =Interest cost +Preffered…

Q: The Paulson Company's year-end balance sheet is shown below. Its cost of common equity is 17%, its…

A: WACC (weighted average cost of capital) refers to the average cost that is paid by a company to…

Q: Edna Recording​ Studios, Inc., reported earnings available to common stock of ​$4,000,000 last year.…

A: a) Price of common stock (P0) = $39 Last dividend paid (D0) = $1.17 Growth rate (g) = 6%…

Q: In 2018, Beta Corporation earned gross profits of $720,000. a. Suppose that Beta was financed by a…

A: Calculation of net profits:Excel spreadsheet:

Q: How much are the total earnings will be available for common stock holders? Calculate the Earnings…

A: Earnings available to shareholders is the amount which can be distributed to the shareholders. It…

Q: Conrad Corporation plans to raise $8 million to pay off its existing short-term bank loan of $2.4…

A: Money to be raised : $8 million Debt repayment : $2.4 million Assets purchase : $5.6 million…

Q: Sales for J. P. Hulett Inc. during the past year amounted to $4.0 million. Gross profits totaled…

A: Taxes on income: All corporations are required to pay taxes on their income.  The IRA has an…

Q: Builtrite had sales of $900,000 and COGS of $280,000. In addition, operating expenses were…

A: Formula: Taxable income = EBIT + Dividends + Net capital loss Sum of both EBIT , Dividends income…

Q: e Allen corporation had sales of $63 million, total assets of $44 million, and total liabilities of…

A: Operating return on assets = Operating profit / sales * 100

Q: XYZ anticipates earning $1,800,000 and paying $300,000 in dividends this year. XYZ's capital…

A: equity break point=retained earningfraction of equity

Q: A Company recently reported $15,500 of sales, $8,250 of operating costs other than depreciation, and…

A: Given: Sales $15,500 Operating Costs $8,250 Depreciation $1,750.  It had $9,000 of bonds outstanding…

Q: Last year​ Sanderson, Inc. had sales of $3.1 million. The​ firm's cost of goods sold came to $2.1…

A: Taxable Income: When calculating the amount of taxes owing by a person or a business, taxable income…

Q: This year, Southern Coat Company had sales of £730,000. Cost of goods sold, administrative and…

A: Sales = 730,000 Cost of Goods Sold = 580,000 Admin and selling expenses = 105,000 Depreciation…

Q: Example: Gainer Company has three sources of financing: $3 million of mortgage bonds paying 5…

A: Cost of capital is the cost at which the company obtains the funds from external or internal…

Q: LILSO’s group's published annual report showed the following: -Operating profit for the year was EGP…

A: The income that a common shareholder earns on the shares which are under the possession of the…

Q: Armitage Inc. has earned gross receipts of about $10 million for the past 3 years. This year it…

A: Business interest expense for the year is that amount which is properly allocable to both an…

Q: Reliable Corporation had sales of $61,122,248, cost of goods sold of $24,201,696, operating expenses…

A: Given: Reliable Corporation had sales of $60,257,593, cost of goods sold of $24,092,883, operating…

Q: your company has taken a loan for $2,000,000 at 5% annual interest. your company has also issuwd 15…

A: WACC (weighted average cost of capital) = [(cost of loan * % of loan in total capital)*(1-tax rate)]…

Q: Planet Express has liabilities of $400 and assets of $1000. The average YTM on its debt is 10% and…

A: FORMULA FOR WACC: WACC=WP×KP+WD×KD×1-TAX WHERE, WD=weight of debtwp=weight of preferred sharekd=cost…

Q: The LD TV Corporation had taxable income of $815,000 this past year. Its cost of goods sold was $0.8…

A: Operating Income = Sales + Cost of goods sold + Operating expenses +Interest expenses - Interest…

Q: A company reported earnings available to common shareholders as $4,200,000 last year. From those…

A: A company reported earnings available to common shareholders as $4,200,000 last year. From those…

Q: e are currently at the beginning of a year. Assume that XYZ has a 100% payout rate, 1,500 shares…

A:

Q: onrad Corporation plans to raise $8 million to pay off its existing short-term bank loan of $2.4…

A: Debt Ratio is the ratio of total debt to total assets. in the balance sheet. Let us look at balance…

Q: Rockland Corporation earned net income of $300,000 in 2020 and had 100,000 shares of common stock…

A: Saving in income tax net of tax = Interest expense *(1-tax rate) = ($800,000*9%)*(1-0.20) = $57,500

Q: XYZ anticipates eaming $1,800,000 and paying $300,000 in dividends this year. XYZ's capital…

A: Given:Anticipates earnings=$1800000Dividend=$300000Capital structure=20% debt and 80% equityTax…

Q: Moncton Meats is a corporation that earned $3 per share before it paid any taxes. The firm retained…

A: Amount of earnings distributed per share = (Earnings per share - Earnings per share x corporate tax…

Q: A. If the market price of the common stock is $40 and dividends are expected to grow at a rate of 6%…

A: Company’s cost of retained earnings financing = (D1 or dividend next year/P0)+growth rate Company’s…

Q: The financial breakeven point of Soil Inc. is P90,000, while the tax rate applicable to the company…

A: Interest paid = Outstanding loan * Interest rate = 200000*10% = P20000

Q: alculate Paulson's WACC using market-value weights. Do not round intermediate calculations. Round…

A: WACC is the weighted average cost of capital. It is the average cost of all sources of capital i.e.…

Q: ubbleTree Inc. had a taxable income of $440,000 last year. Its average tax rate is 31% and it paid…

A: In this question we need to compute the value of retained earnings. To calculate retained earnings…

Q: Raleigh Corp's total common equity at the end of last year was $300,000 and its net income after…

A: Return on equity (ROE) is a measure of financial performance calculated by dividing net income by…

Q: XYZ Electronics Inc. is all equity financed and generates perpetual annual EBIT of $600. Assume that…

A: Correct answer is $12,000   XYZ goes ahead with the repurchase, then what is the value of the…

Q: Marine Outlets, Inc. had $ 14 million in sales last year, COGS of $ 8 million, depreciation expense…

A: In the given question we need to compute the Firm's Net income from the information given.

Q: A firm’s annual revenues are $850,000. Its expenses for the year are $615,000, and it claims…

A: Tax:- It is the amount which one pays to the government of the country as per prescribed rates or…

Q: Gainer Company has three sources of financing: $3 million of mortgage bonds paying 5 percent…

A: Mortgage bonds value=3000000 cost of bond=5% after tax=r1=5(1-0.4)=3% weighted…

Fringe Benefit Tax

Fringe benefits are in addition to the compensation that companies give to their employees. It is an additional benefit above the stated salary. It helps to keep the employees of the firm motivated as sometimes the only salary is not enough to retain the quality employees of the firm. There are different types of fringe benefits. Fringe benefits are given in both private as well as public enterprises.