Cash Marketable securities Accounts receivable Inventory Total current Building Equipment Total Sales Cost of goods sold Gross profit Ren Company 2022 Balance Sheet $ 5,000 5,000 10,000 35.000 55,000 100,000 15.000 $170.000 Accounts payable Taxes payable Accruals Total current Notes payable (8%) Bonds payable (12%) Common stock Retained earnings Total Ren Company 2022 Income Statement Selling and administrative expenses $ 3,000 12,000 3.500 18,500 15,000 30,000 48,000 58.500 $170.000 % $245,000 100 183.750 75 61,250 29.296 EBIT 31.954 Interest (15,000 @ 8% + 30,000 @ 12%) 82325 12 13 EBT 4.800 27,154 Taxes 8,146 Net income 19,008 Dividends 15.000 Addition to retained earnings $ 4,008 Schedule of Projection Assumptions for Year Ending 2023 1. $25,000 sales increase. 2. Marketable securities are not spontaneous. S. $5,000 new equipment, net 4. COGS is 75% of sales and Selling and administrative expenses is 12% of sales. 6. $5,000 of Bonds Payable will be retired and will NOT be rolled over. 7. 80% of EFN financed with debt costing 11%. 8. Remaining EFN from external equity. 9. Taxes will remain at same effective tax rate as 2022. 10. Dividends payout ratio will remain the same as 2022. *Will have an impact on existing interest expense calculation in EFN and Projected Income Statement