1) Wellner Systems has the following balance sheet.
How much net operating working capital (NOWC) does the firm have?
Cash $ 300 Accounts payable $ 300
Accounts receivable 650 Accruals 350
Inventory 550 Notes payable 450
Current assets $1,500 Current liabilities $ 1100
Net fixed assets 1,000 Long-term debt 600
Common equity 300
Retained earnings 500
Total assets $2,500 Total liab. & equity $2,500
2) Ramco recently reported $30 million of sales, $15 million of operating costs and $3.00 million of depreciation. It had $9 million of bonds outstanding that carry a 5.0% interest rate, and its federal-plusstate income tax rate was 40%.
What was Ramco's operating income, or EBIT (a.k.a. "Operating income"), in millions?
3) Barco recently reported $25,000 of sales, $7,250 of operating costs and $2,750 of depreciation. It had $10,000 of bonds outstanding that carry a 5.0% interest rate, and its federal-plus-state income tax rate was 35%. How much was the firm's earnings before taxes (EBT)?