Question
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$5.00 Pro forma income statement
- From Business: Accounting
- Closed, but you can still post tutorials
- Due on Dec. 02, 2007
- Asked on Nov 25, 2007 at 6:56:47PM
Q:At the end of last year, Roberts Inc. reported the following 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 percent higher than the $3 billion in sales generated last year.
Year-end operating costs, excluding depreciation, are expected to equal 80 percent 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 percent.
On the basis of this information, what will be the forecast for Robert’s year-end net income?
