Onyx expects to have an EBIT of $240,000 with a standard deviation of $110,000.The distribution of operating income is approximately normal.If Onyx has interest expenses of $50,000, what is the probability that it will have an operating income that is below $0?
A)4.27%
B)1.46%
C)0.02%
D)2.4%

Question

Quizplus · Accepted Answer

z = ($0 - $240,000)/$110,000 = -2.18;From Table V, p = 1.46%

Onyx Expects to Have an EBIT of $240,000 with a Standard