Principles of Finance HELP!!!
posted by Laura .
Problem 16-7. Pro forma income statement At the end of last year, Roberts Inc. reported the following income statement (in millions of dollars):
Operating costs excluding depreciation 2450
Taxes (40%) 70
Net income 105
Looking ahead to the following year, the company's CFO has assembled the following information:
--Year-end sales are expected to be 7% higher than the $3 billion in sales generated last year.
--Year-end operating costs excluding depreciation are expected to equal 65% of year-end sales.
--Depreciation is expected to increase at the same rate as sales.
--Interest costs are expected to remain unchanged.
--The tax rate is expected to remain at 40%.
On the basis of this information, what will be the forecast for Roberts' year-end net income? Round the answer to the nearest hundredth.
I'm having trouble figuring out the correct net income for this problem!!!
Hope anyone can help me!!!
Due to a techincal breakthrough,theb fix costs for a firm drop by 25%. Prior to this breakthrough fixed costs were 100,000 and unit contribution margin was and remains at 5.00. The new amount of break-even units will be:
(in million of dollars)
($3000 M * 10%)
Operating Cost including depreciation ($2,640)
(Operatinc Cost excluding Dep will equl to 80% ofSales)
EBIT & D $660
Depreciation (10%) $66
Income Tax (40%) ($187.60)
Net Income $281.40
Robert's year end net income is $156 million
year end balance for receivables is 32.77 million
year end days sales outstanding (DSO) ratio is 36 days