You are provided with the following information on Kayray Corporation. Your ultimate objective is to calculate the EVA for the firm. LIFO reserve 60 Net plant, property, and equipment 1,325 Other assets 30 Goodwill 325 Accumulated Goodwill amortized 65 PV of Operating leases 140 Tax benefit from interest on expenses 10 Tax benefit from interest on leases 5 Taxes on non-operating income 2 Implied interest on op. lease 9.5 Increase in LIFO reserve 12 Goodwill amortization 15 Operating profit 550 Income tax expense 215 Net working capital 440 WACC 0.12 Refer to Exhibit 9.15. Calculate the adjusted operating profits before taxes. a. $586.5 b. $225.64 c. $825.23 d. $692.5 e. $831.56

You are provided with the following information on Kayray Corporation. Your ultimate objective is to calculate the EVA for the firm. LIFO reserve 60 Net plant, property, and equipment 1,325 Other assets 30 Goodwill 325 Accumulated Goodwill amortized 65 PV of Operating leases 140 Tax benefit from interest on expenses 10 Tax benefit from interest on leases 5 Taxes on non-operating income 2 Implied interest on op. lease 9.5 Increase in LIFO reserve 12 Goodwill amortization 15 Operating profit 550 Income tax expense 215 Net working capital 440 WACC 0.12 Refer to Exhibit 9.15. Calculate the adjusted operating profits before taxes. a. $586.5 b. $225.64 c. $825.23 d. $692.5 e. $831.56

SWFT Essntl Tax Individ/Bus Entities 2020

23rd Edition

ISBN:9780357391266

Author:Nellen

Publisher:Nellen

Chapter5: Business Deductions

Section: Chapter Questions

Problem 49P

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bartleby, a Learneo, Inc. business

LIFO reserve	60
Net plant, property, and equipment	1,325
Other assets	30
Goodwill	325
Accumulated Goodwill amortized	65
PV of Operating leases	140
Tax benefit from interest on expenses	10
Tax benefit from interest on leases	5
Taxes on non-operating income	2
Implied interest on op. lease	9.5
Increase in LIFO reserve	12
Goodwill amortization	15
Operating profit	550
Income tax expense	215
Net working capital	440
WACC	0.12