What is the ni and tax bill of wld

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Question - Assume that WLD company has annual revenue of 200, COGS of $160 and SG&A (combined) = 50; Book value of PP&E = 300 and PP&E's useful life = 10. IRS allows only a straight line depreciation. Tax rate = 20%.

Required -

1. What is the NI and Tax Bill of WLD?

2. Now assume that WLD is able to reclassify $100 of COGS as CapEx.  What is the NI and Tax Bill of WLD?

Reference no: EM133130594

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