Question1: Companies create income from their "regular" operations & from things like interest on securities they hold, which is called non-operating income. Selfi Metals recently reported $9,000 of sales, 6,000 dollars of operating costs other than depreciation, & $1,500 of depreciation. The company had no amortization charges and no non operating income. It had issued 4,000 dollars of bonds that carry a 7 percent interest rate, & its federal-plus-state income tax rate was 40%. Calculate the firm’s operating income, or EBIT?
[A] $1,300
[B] $1,400
[C] $1,500
[D] $1,100
[E] $1,200
Question2: Collins Inc’s latest net income was $1 million, & it had 200,000 shares outstanding. The company wants to pay out 40 percent of its income. Calculate the dividend per share.
[A] $1.80
[B] $1.90
[C] $2.00
[D] $1.60
[E] $1.70