Use the Information for the Question(s) Below

question 52

Multiple Choice

Use the information for the question(s) below.
Shepard Industries is evaluating a proposal to expand its current distribution facilities. Management has projected the project will produce the following cash flows for the first two years (in millions of dollars) .

-The incremental EBIT for Shepard Industries in year two is closest to:

• A) $415 million
• B) $875 million
• C) $595 million
• D) $510 million

---

Definitions:

Statement of Cash Flows

A document that illustrates the influence of balance sheet modifications and revenue on the availability of cash and equivalents, categorized by activities related to operating, investing, and financing.

Par Value

The face value of a bond or stock as stated by the issuing company, often used as an accounting standard or a minimum value.

Common Stock

A type of equity ownership in a corporation, representing a claim on part of the company's earnings and assets, with voting rights on corporate matters.

Journal Entry

A record in accounting that represents a transaction in the ledgers.