13. Last year, Yukon Company reported $10,500,000 of sales, $6,250,000 of operating costs (excluding depreciation),...
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13. Last year, Yukon Company reported $10,500,000 of sales, $6,250,000 of operating costs (excluding depreciation), and $1,300,000 of depreciation. The company had $5,000,000 of bonds that carried a 6.5% interest rate, and its federal-plus-state income tax rate was 35%. This year's data were expected to remain unchanged except for one item, depreciation, which was expected to increase by $630,000. The company uses the same depreciation calculations for tax and stockholder reporting purposes. By how much would the net income change as a result of the change in depreciation? * 5 points The net income would decrease by $409,500 The net income would decrease by $220,500 The net income would decrease by $630,000 The net income would decrease by $1,296,750 None of the above
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