Replies to post #44753 on 1812 Brewing Company Inc (KEGS)

[Palmer032]

If they were a private corporation and were trying to avoid double taxation they would want their net income to be as low as possible.

[crooked33]

my guess is hacketts took a hit in 2006 related to their new store they just opened...my guess is given the 100 per sq ft in sales they actually have bettter margins then wisebuys...i bet financials will show a one time charge for that new store...all imo

[transam73wi]

Depreciation can mislead one on net income. Let's say one year you make $5,000,000 in net income. You have a comprehensive income (change) of $1,000,000. Your total of $6,000,000 in net income. BUT, you spent $7,000,000 on expansion (credit from the bank) which increase your interest payments each month (expenses), and you depreciation expense (tax deductable) goes up to $3,000,000 for the year (at the now acceptable accelerated rate allowed). Your interest payments at 8% annualy would be $560,000 plus depreciation expense of $3m, equals $3.56 mill off your net income, which leaves only $2,440,000 net income, BUT you expanded from 5 stores to 15 stores. Revenues are key here, not necessarily net income.