Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Basic Finance Expert

problem: Pro forma income statement at the end of last year, Roberts Inc. reported the given income statement [in millions of dollars]:

Sales

$3,000

Operating costs excluding depreciation

  2,450

EBITDA

   $550

Depreciation

     250

EBIT

   $300

Interest

     125

EBT

   $175

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 10% higher than the 3 billion dollar in sales generated last year.

Year-end operating costs, excluding depreciation, are expected to equal 80% of year-end sales.

Depreciation is expected to rise 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 Robert's year-end net income?

 

 

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M919906

Have any Question? 


Related Questions in Basic Finance

Locate a newspaper or magazine article that reports a

Locate a newspaper or magazine article that reports a behavioral science research project. a. Determine whether the project is a descriptive, a correlational, or an experimental research design. b. What variables are mea ...

What distinguishes an ordinary annuity from an annuity due

What distinguishes an ordinary annuity from an annuity due? What distinguishes an ordinary annuity from a deferred annuity? If a cash flow is the same amount each period, ad infinitum, how do we value the present value o ...

1 how can tax-exempt bonds offer lower-cost mortgage money

1. How can tax-exempt bonds offer lower-cost mortgage money and how is this money generally used? 2. Explain the two basic kinds of mortgage pools used to back securities and the two different methods used to generate th ...

Hello kitty company claims that the proportion of its

Hello Kitty Company claims that the proportion of its employees investing in individual investment accounts is higher than national proportion of 50%. A survey of 100 employees in Hello Kitty Company indicated that 58 of ...

1 how can leasing allow a firm to effectively depreciate

1. How can leasing allow a firm to effectively "depreciate" land? 2. What effect does leasing have on the stability of a firm's reported earnings? 3. It has been argued that leasing is almost always more expensive than b ...

1 why do a firms stockholders hold a valuable default

1. Why do a firm's stockholders hold a valuable "default option"? How could this option induce stockholders to employ high levels of financial leverage? 2. All else equal, which firm would face a greater level of financi ...

One bond in forest inc has 9 years to maturity and a coupon

One bond in Forest, Inc., has 9 years to maturity and a coupon of 4.2%. The coupon is paid semiannually. If the YTM is 6%, what is the value of the bond? Marcia Food Company has a bond with 15 years to maturity and a cou ...

Compare and contrast transaction exposure and economic

Compare and contrast transaction exposure and economic exposure? Why might the cash flows of purely domestic firms be exposed to exchange rate fluctuations? How do most companies deal with economic exposure?

1 how do inflationary expectations influence interest rates

1. How do inflationary expectations influence interest rates on mortgage loans? 2. How does the price level adjusted mortgage (PLAM) address the problem of uncertainty in inflationary expectations? What are some of the p ...

Company b just paid an annual dividend of 42 a share the

Company B just paid an annual dividend of $.42 a share. The stock is selling for $18 a share and has a growth rate of 2.2 percent. What is the dividend yield, using the constant growth model?

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro

Describe what you learned about the impact of economic

Describe what you learned about the impact of economic, social, and demographic trends affecting the US labor environmen