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Given the following information for Sookie’s Cookies Co., calculate the depreciation expense: sales = $88,554; costs...

Given the following information for Sookie’s Cookies Co., calculate the depreciation expense: sales = $88,554; costs = $62,054; addition to retained earnings = $221; dividends paid = $460; interest expense = $347; tax rate = 30 percent. (Hint: Build the Income Statement and fill in the missing pieces until you get to the depreciation expense. You may have to work from bottom up.)

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Answer #1
sale $      88,554.00
Less Cost $      62,054.00
Profit before depreciation and interes $      26,500.00
reatined earnings $            221.00
Add Dividend $            460.00
Profit after tax $            681.00
Profit before tax=681/.07 $            972.86
Add Interest $            347.00
Profit after interest $         1,319.86
Depreciation = 26500-1319.86
$      25,180.14
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