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Are my calculations in the spreadsheet correct? INSTRUCTIONS: 1). Complete the budget projections for years 2021-2024 using the following information Revenue increases 4% annually 4%
Are my calculations in the spreadsheet correct?
INSTRUCTIONS: | ||||||
1). Complete the budget projections for years 2021-2024 using the following information | ||||||
Revenue increases 4% annually | 4% | |||||
Expense increases 2% annually | 2.75% | |||||
For Depreciation and Interest expenses assume the Acutal 2020 figure as the base for the budget and and forecast then add the amount calculated in the Payback tab for both budget and forecast. (Payback tab Depreciation=$23.89/year. Interest (Yrs 1-6) $9.03, $8.09, $7.11, $6.07, $4.98, $3,83 | ||||||
2). Answer the question below the forecast. | ||||||
Largo Global Income Statement of December 31, 2020 (millions) | ||||||
ACTUAL | BUDGET | FORECAST | ||||
2020 | 2021 | 2022 | 2023 | 2024 | ||
Sales (net sales) | $2,013 | $2,094 | $2,177 | $2,264 | $2,355 | |
Cost of goods sold | 1400 | 1439 | 1478 | 1519 | 1560 | |
Gross profit | 613 | 655 | 699 | 746 | 794 | |
Selling, general, and administrative expenses | 125 | 128 | 132 | 136 | 139 | |
Earnings before Interest, taxes, depreciation, and amortization (EBITDA) | 488 | 527 | 567 | 610 | 655 | |
Depreciation and amortization | 174 | 198 | 199 | 194 | 193 | |
Earning before interest and taxes (EBIT) Operating income (loss) | 314 | 329 | 368 | 416 | 462 | |
Interest expense | 141 | 184 | 184 | 184 | 184 | |
Earnings before taxes (EBT) | 173 | 145 | 184 | 232 | 278 | |
Taxes (34%) | 59 | 60 | 62 | 64 | 66 | |
Net earnings (loss)/Net Income | $ 114 | 84 | 122 | 168 | 213 |
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