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Complete the Year 2 income statement data for Blue Hamster, then answer the questions that follow. Be sure to round each dollar value to the
Complete the Year 2 income statement data for Blue Hamster, then answer the questions that follow. Be sure to round each dollar value to the nearest whole dollar Blue Hamster Manufacturing Inc Income Statement for Year Ending December 31 Year 2 Year 1 (Forecasted) $20,000,000 13,000,000 800,000 $6,200,000 620,000 5,580,000 2,232,000 $3,348,000 100,000 3,248,000 1,171,800 $2,076,200 $25,000,000 16,250,000 800,000 $7,950,000 1,192,500 6,757,500 2,703,000 $4,054,500 100,000 3,954,500 1,419,075 $2,535,425 Net sales Less: Operating costs, except depreciation and amortization Less: Depreciation and amortization expenses Operating income (or EBIT) Less: Interest expense Pre-tax income (or EBT) Less: Taxes (40%) Earnings after taxes Less: Preferred stock dividends Earnings available to common shareholders Less: Common stock dividends Contribution to retained earnings Given the results of the previous income statement calculations, complete the following statements: In Year 2, if Blue Hamster has 10,000 shares of preferred stock issued and outstanding, then each preferred share should expect to receive $10.00 in annual dividends If Blue Hamster has 500,000 shares of common stock issued and outstanding, then the firm's earnings per share (EPS) is expected to change from in Year 1 to in Year 2 . Blue Hamster's before interest, taxes, depreciation and amortization (EBITDA) value changed from in Year 1 to in Year2 It is incorrect to say that Blue Hamster's net inflows and outflows of cash at the end of Years 1 and 2 are equal to the company's annual contribution to retained earnings, $2,076,200 and $2,535,425, respectively. This is because income statement involve payments and receipts of cash all but one of the item reported in the
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