Question
At the end of last year, Edwin Inc. reported the following income statement (in millions of dollars): Sales $4,200 Operating costs excluding depreciation 3,087 EBITDA
At the end of last year, Edwin Inc. reported the following income statement (in millions of dollars):
| Sales | $4,200 |
| Operating costs excluding depreciation | 3,087 |
| EBITDA | $1,113 |
| Depreciation | 330 |
| EBIT | $783 |
| Interest | 160 |
| EBT | $623 |
| Taxes (40%) | 249 |
| Net income | $374 |
Looking ahead to the following year, the company's CFO has assembled this information:
Year-end sales are expected to be 4% higher than $4.2 billion in sales generated last year.
Year-end operating costs, including depreciation, are expected to increase at the same rates as sales.
Interest costs are expected to remain unchanged.
The tax rate is expected to remain at 40%.
On the basis of this information, what will be the forecast for Edwin's year-end net income? Round your answer to the nearest whole million. Do not round intermediate calculations. Enter all values as positive numbers.
| (in millions of dollars) | |
| Sales | $ |
| Operating costs including depreciation | |
| EBITDA | $ |
| Depreciation | |
| EBIT | $ |
| Interest | |
| EBT | $ |
| Taxes | |
| Net income | $ |
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started