Question
Intro Model Corp.'s most recent balance sheet and income statement are given below (all numbers in $ million): Assets Liabilities and Equity Cash 33 Accounts
Intro
Model Corp.'s most recent balance sheet and income statement are given below (all numbers in $ million):
Assets | Liabilities and Equity | |||
Cash | 33 | Accounts payable | 99 | |
Accounts receivable | 66 | Current liabilities | 99 | |
Inventory | 99 | Long-term debt | 198 | |
Current assets | 198 | Total liabilities | 297 | |
Net PPE | 132 | Equity | 33 | |
Total assets | 330 | Total liab. & equity | 330 |
Income statement | |
Sales | 100 |
Operating Costs | 60 |
Depreciation | 20 |
EBIT | 20 |
Interest | 9.9 |
Taxable income | 10.1 |
Taxes | 3.434 |
Net income | 6.666 |
Sales, operating costs, and depreciation are expected to grow by 40% next year. All asset accounts and the accounts payable will be the same percentage of sales as they have been historically. The tax rate and interest-bearing debt will stay constant. The company pays out 30% of net income as dividends. No stock issuances or repurchases are expected.
Using the percentage of sales method, what will be the net income next year (in $ million)?
Using the percentage of sales method, what will be the book value of equity next year (in $ million)?
What is the [external financing required] ([EFR]) for next year (in $ million)?
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