(Answered) Assume a company is formed with 100 of equity capital all

Finance

Assume a company is formed with $100 of equity capital, all of which is immediately invested in working capital. Assumptions are as follows:

Dividends	Nondividend-Paying
First-year sales	$100
Sales growth	10% per year
Cost of goods sold/Sales	20%
Operating expense/Sales	70%
Interest income rate	5%
Tax rate	30%
Working capital as percent of sales	90%

Based on this information, forecast the company's net income and cash flow for five years.

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