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Calculating earnings before income tax-depreciation

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Reference no: EM13828273

Problem:

1. Your firm has net income of $198 on total sales of $1,200. Costs are $715, depreciation is $145 and amortization is $55. The tax rate is 34%. The firm does not have any interest expense. What is your firm's EBITDA?

a. $93
b. $241
c. $340
d. $383
e. $485

2. Teddy's Pillows has beginning net fixed assets of $480 and ending net fixed assets of $530. Assets with a market value of $300 were sold during the year. Depredation was $40. How much did Teddy's Pillows spend on capital expenditures?

a. $10
b. $50
c. $90
d. $260
e. $390

Additional Information:

These multiple choice questions is from Finance. The first question is about calculating earnings before income tax, depreciation and amortization and the second question is about calculating depreciation from difference in assets.

Reference no: EM13828273

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