Question: The income statements for Amazon.com, Google, Inc., and Borders, lnc., for a recent year are provided below. In addition, the statement of cash flows revealed

The income statements for Amazon.com, Google, Inc., and Borders, lnc., for a recent year are provided below.

In addition, the statement of cash flows revealed the following line item in the cash flows from operations section of the statement:

1. Determine EBITDA (earnings before interest, taxes, depreciation, and amortization) for each company.
2. Why is the EBITDA for Amazon.com actually less than the net income?
3. Would you conclude that the EBITDA performance of Amazon.com is more like an Internet company such as Google, Inc., or more like a book retailer like Borders, Inc.? Explain.
4. How is EBITDA different than cash flows fromoperations?

Amazon.com Google, Inc. Borders, Inc Net sales Cost of sales Gross profit Selling, general, and administrative expenses Operating income Interest expense (income) Income before income taxes Income taxes expense (benefit) Net income $6,921 5,319 $1,602 1,162 s 440 84 356 (232) 588 $3,189 1,457 $1,732 1,092 640 (10) 650 251 399 $3,903 2,804 $1,099 883 S 216 207 76 S 131 Google, Inc. $148 Borders, Inc. $113 Amazon.com Depreciation and amortization $76

Step by Step Solution

★★★★★

3.49 Rating (179 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock

1 EBITDA Amazoncom Google Inc Borders Inc Operating income 440 640 216 Plus Depreciation and amortiza tion expense 76 148 113 EBITDA 516 788 329 2 Ama... View full answer

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Document Format (1 attachment)

126-B-A-I-S (929).docx

120 KBs Word File

Students Have Also Explored These Related Accounting Questions!

Amortization of Intangibles and Effects on Statement of Cash Flows Tableleaf Inc. purchased a patent a number of years ago. The patent is being amortized on a straight-line basis over its estimated...

Amortization of Intangibles and Effects on Statement of Cash Flows Quickster Inc. acquired a patent a number of years ago. The patent is being amortized on a straight-line basis over its estimated...

In its 2010 statement of cash flows (see www.pepsico.com), what amount did PepsiCo report for net cash (a) Provided by operating activities, (b) Used for investing activities, and (c) Used for...

please complete the answer sheet using 2016 annual report Financial Statement Analysis Project ANSWER SHEET Name(s): No. Question 1. Who is responsible for the financial statements and maintaining...

In the summer of 1994, Jeff Bezos sacrificed a promising career in investment banking and his personal savings to start what would become Earth's Biggest Bookstore, Amazon.com. He left New York and...

Write an engagement letter of no more than 1,050 words for a Section 404 audit of Apollo Shoes. Assume that Apollo Shoes is a publicly traded company for which the SEC requires an audit of internal...

Hi! I need help for this assignment, please let me know if WEEK 6 WILEYCPA Ownership of 51% of the outstanding voting stock of a company would usually result in The use of the cost method. The use of...

Apollo case studies the question is on page 44 Apollo case studies the question is on page 44 Apollo case studies the question is on page 44 APOLLO SHOES, INC. An Audit Case to Accompany AUDITING AND...

Directions to students: Download the solution to part 1 in the doc share (FILE: Unit 1 ETHICS CASE) or by clicking on the button to the left. Review the solution to parts 1 and 2 in the case. Drawing...

Water is 56.3 g benzoic acid/1 L water at 100 degrees Celcius. While 1.7 grams of benzoic acid dissolves in 1 liter of water at 0 degrees Celsius. Find the volume of boiling water required to...

The balance of $12,000 for Prepaid Insurance represents payment on August 1st, 2022 for a 12-month insurance policy covering the period of August 1st, 2022 through July 31, 2023. The $21,860 balance...

9.46 If i s = 5 cos(10 t + 40) A in the circuit of Fig. 9.53, find i o . 3 200 mH 100 mF

Moran Labs performs steroid testing services to high schools, colleges, and universities. Because the company deals solely with educational institutions, the price of each test is strictly regulated....

For the situation described in part (a) of Example 13.5, what should be the value of the putty mass m so that the amplitude after the collision is one-half the original amplitude? For this value of...

An investor is considering buying some land for $100,000 and constructing an office building on it. Three different buildings are being analyzed. *Resale value to be considered a reduction in cost,...

Vidro Company prepares monthly cash budgets. Relevant data from operating budgets for 2011 are: All sales are on account. Collections are expected to be 60% in the month of sale, 30% in the first...

McNair Company has several processing departments. Costs charged to the Assembly Department for October 2010 totaled $1,249,500 as follows. Production records show that 25,000 units were in beginning...

Mens and womens heights. The heights of women aged 20 to 29 are approximately Normal with mean 64 inches and standard deviation 2.7 inches. Men the same age have mean height 69.3 inches with standard...

Product A has a unit contribution margin of $45. Product B has a unit contribution margin of $60. Product A requires three testing hours, while Product B requires five testing hours. Determine the...

Inman Construction Company is considering selling excess machinery with a book value of $280,000 (original cost of $400,000 less accumulated depreciation of $120,000) for $292,000, less a 5%...

A condensed income statement by product line for British Beverage Inc. indicated the following for Royal Cola for the past year: Sales $254,000 Cost of goods sold 122,000 Gross profit $132,000...

Find the future value of the following ordinary simple annuity. \ table [ [ \ table [ [ Periodic ] , [ Payment ] ] , \ table [ [ Payment ] , [ Interval ] ] , Term,Interest Rate, \ table [ [...

Financial data for Joel de Paris, Inc., for last year follow: Joel de Paris, Inc. Balance Sheet Beginning Ending Balance Balance Assets Cash $ 126,000 $ 132,000 Accounts receivable 346,000 487,000...

A house costing RM120,000 cash is purchased by making a down payment of RM40,000 and the balance is to be settled by making 120 monthly payments at 6% compounded monthly. (a) Find this monthly...