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2016 Actual Results 2017 Initial Forecast Net sales $17,000 $22,100 Cost of goods sold (13,600) (17,680) Gross profit $3,400 $4,420 Fixed operating costs except depreciation
2016 Actual Results 2017 Initial Forecast Net sales $17,000 $22,100 Cost of goods sold (13,600) (17,680) Gross profit $3,400 $4,420 Fixed operating costs except depreciation (850) (1,105) Depreciation (340) (442) Earnings before interest and taxes $2,210 $2,873 Interest (340) (340) Earnings before taxes $1,870 $2,533 Taxes (748) (1,013.2) Net income $1,122 1,519.8 Common dividends (605.88) (605.88) Addition to retained earnings $516.12 $913.92 Earnings per share $56.1 $75.99 Dividends per share $30.294 $30.294 Number of common shares (millions) 20.0 20.0 Which of the following are assumptions made by the initial income statement forecast? Check all that apply. No additional external financing will be required. The facility is currently operating at full capacity. The assigned depreciation method has changed. The forecasted increase in net sales is 30%. The facility is not currently operating at full capacity. Additional external financing will be required by Black Sheep Broadcasting Company
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