Question
Jim's Espresso expects sales to grow by 10.0% next year. Assume that Jim's pays out 90% of its net income. Use the following statements and
Jim's Espresso expects sales to grow by 10.0% next year. Assume that Jim's pays out 90% of its net income. Use the following statements and the percent of sales method to forecast:
a. Stockholders' equity
b. Accounts payable
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.
1: Data Table
Click on the icons located on the top-right corners of the data tables below to copy their contents into a spreadsheet.
Income Statement |
| Balance Sheet |
| ||
Sales | $200,000 | Assets | |||
Costs Except Depreciation | (100,000) | Cash and Equivalents | $15,000 | ||
EBITDA | $100,000 | Accounts Receivable | 2,000 | ||
Depreciation | (6,000) | Inventories | 4,000 | ||
EBIT | $94,000 | Total Current Assets | $21,000 | ||
Interest Expense (net) | (400) | Property, Plant, and Equipment | 10,000 | ||
Pre-tax Income | $93,600 | Total Assets | $31,000 | ||
Income Tax | (32,760) | ||||
Net Income | $60,840 | Liabilities and Equity | |||
Accounts Payable | $ 1 comma 500$1,500 | ||||
Debt | 4 comma 0004,000 | ||||
Total Liabilities | $ 5 comma 500$5,500 | ||||
Stockholders' Equity | 25 comma 50025,500 | ||||
Total Liabilities and Equity | $ 31 comma 000$31,000 |
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