Question
Based on Jim's expectation of 10.5% sales growth and payout ratio of 81.43% of net income next year, Jim developed the pro forma financial statements
Based on Jim's expectation of 10.5% sales growth and payout ratio of 81.43% of net income next year, Jim developed the pro forma financial statements given below. What is the amount of net new financing needed for Jim's Espresso? Click on the icon located on the top-right corner of the data table below to copy its contents into a spreadsheet.
Pro Forma Financial Statements
Income Statement | Balance Sheet |
| |||
Sales | $228,823 | Assets | |||
Costs Except Depreciation | (111,085) | Cash and Equivalents | $16,597 | ||
EBITDA | $117,738 | Accounts Receivable | 2,166 | ||
Depreciation | (6,663) | Inventories | 4,486 | ||
EBIT | $111,075 | Total Current Assets | $23,249 | ||
Interest Expense (net) | (508) | Property, Plant, and Equipment | 10,951 | ||
Pre-tax Income | $110,567 | Total Assets | $34,200 | ||
Income Tax | (38,698) | ||||
Net Income | $71,869 | Liabilities and Equity | |||
Accounts Payable | $1,624 | ||||
Debt | 4,050 | ||||
Total Liabilities | $5,674 | ||||
Stockholders' Equity | $38,776 | ||||
Total Liabilities and Equity | $44,450 |
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.
Select requires or excess below-
The total new( Required/Excess) financing will be___
(Round to the nearest dollar.)
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored 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