Question

spreadsheet. Income Statement​ ($ million) Balance Sheet​ ($ million) Net Sales 186.2186.2 Assets Costs Except Depreciation...

spreadsheet.

Income Statement​ ($ million)

Balance Sheet​ ($ million)

Net Sales

186.2186.2

Assets

Costs Except Depreciation

negative 175.9−175.9

Cash

22.222.2

EBITDA

10.310.3

Accounts Receivable

17.917.9

Depreciation and Amortization

negative 1.3−1.3

Inventories

15.715.7

EBIT

99

Total Current Assets

55.855.8

Interest Income​ (expense)

negative 7.7−7.7

Net​ Property, Plant, and Equipment

112.6112.6

​Pre-tax Income

1.31.3

Total Assets

168.4168.4
Taxes

​(2626​%)

negative 0.3−0.3

Net Income

1.01.0

Liabilities and Equity

Accounts Payable

33.533.5

​Long-Term Debt

112.3112.3

Total Liabilities

145.8145.8

Total​ Stockholders' Equity

22.622.6

Total Liabilities and Equity

168.4168.4

Global Corp. expects sales to grow by

9 %9%

next year. Using the percent of sales method and the data provided in the given tables

LOADING...

​, ​forecast:

a. Costs except depreciation

b. Depreciation

c. Net income

d. Cash

e. Accounts receivable

f. Inventory

g.​ Property, plant, and equipment

h. Accounts payable

​(​Note:

Interest expense will not change with a change in sales. Tax rate is

2626​%.)

The Tax Cuts and Jobs Act of 2017 temporarily allows​ 100% bonus depreciation​ (effectively expensing capital​expenditures). However, we will still include depreciation forecasting in this chapter and in these problems in anticipation of the return of standard depreciation practices during your career.

a. Costs except depreciation

The forecasted costs except depreciation will be

​$nothing

million.

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Homework Answers

Answer #2
Income statement with 9% growth in sales
Current Year 9% Growth
In $ Millions % In $ Millions
Net sales $186.21 100.00% $202.97
Costs except depreciation -$175.90 -94.46% -$191.73
EBITDA $10.31 5.54% $11.24
Depreciation and amortization -$1.30 -0.70% -$1.42
EBIT $9.01 4.84% $9.82
Interest Income (expense) -$7.70 -4.14% -$8.39
Pre-tax Income $1.31 0.70% $1.43
Taxes -$0.30 -0.16% -$0.33
Net Income $1.01 0.54% $1.10
a. Costs except depreciation =$191.73
b. Depreciation=$1.42
c. Net income= $1.10
d. Cash
Current
   =22.2/186.21*100 =11.92%
Proposed
=202.97*11.92% =$24.19
e. Accounts receivable
Current
=17.91/186.21*100
=9.62%
Proposed
=202.97*9.62% =$19.53
f. Inventory
Current
=15.71/186.21*100
=8.44%
Proposed
=202.97*8.44% =$17.13
answered by: anonymous
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