2. Lap Dogs Inc. is planning for next year and has the following summarized results so far ($000):

The Firm pays interest of 12% on all borrowing and is subject to an overall tax rate of 38%. It paid interest of $20,000 this year and plans a $75,000 dividend next year. Complete Lap Dog’s forecast of next year’s financial statements. Round all calculations to the nearest $1,000.

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Income Statement EBIT Interest EBT Income tax EAT 32222 236 ? ? ? ? Balance Sheet This year Next Year Assets 582 745 Current liabilities 63 80 Debt 275 ? Equity 244 ? Total liab & equity 582 745