Chapter 2 ProblemsDetails:.Please show all work for each problem.Financial Statements, CashFlow, and Taxes(23)Income StatementMolteni Motors Inc. recently reported $6 million of net income. Its EBIT was $13 million,and its tax rate was 40%. What was its interest expense? (Hint: Write out the headings foran income statement, and then fill in the known values. Then divide $6 million netincome by 1 T = 0.6 to find the pretax income. The difference between EBIT andtaxable income must be the interest expense. Use this procedure to work some of theother problems.)Chapter 3 Problems Details:Complete problems 8 and 10 in chapter 3 of the textbook.Please show all work for each problem.Analysis of FinancialStatements?(38)Profit Margin andDebt RatioAssume you are given the following relationships for the Haslam Corporation:Sales/total assets 1.2Return on assets (ROA) 4%Return on equity (ROE) 7%Calculate Haslams profit margin and liabilitiestoassets ratio. Suppose half its liabilitiesare in the form of debt. Calculate the debttoassets ratio.(310)TimesInterestEarned RatioThe Morris Corporation has $600,000 of debt outstanding, and it pays an interest rate of8% annually. Morriss annual sales are $3 million, its average tax rate is 40%, and its netprofit margin on sales is 3%. If the company does not maintain a TIE ratio of at least 5 to 1,then its bank will refuse to renew the loan and bankruptcy will result. What is MorrissTIE ratio?(1.)Your stockbroker suggests you concentrate your portfolio on stocks with low P/E ratios.She explains that these firms are likely to be out of favor with investors because they have a low price relative to their current earnings. Is this necessarily a good investmentpractice? Why or why not?(2.)Discuss the practice problems completed(a.) What specifically will you take away from this module?(b.) What your experience working through the problems(c.) Which of the problems was the least challenging and which one was the most challenging?

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