Net Sales INCOME STATEMENT Cost of Good Sold(COGS) Gross Profit Selling, General and Administrative Expense Depreciation and Amortization Earning Before Interest and Tax (EBIT) Interest Expense Earning Before Tax Income Tax Net Earnings After Tax 1999 1998 1997 $ 96,109,848.00 $ 76,022,656.00 $ 54,060,720.00 $ 48,157,296.00 $35,574,580.00 $ 36,079,988.00 $ 47,952,552.00 $ 41,448,076.00 $ 27,980,732.00 $ 28,406,314.00 $ 26,302,452.00 $18,663,164.00 $ 4,919,416.00 $ 3,696,743.00 $ 3,134,909.00 $ 14,626,822.00 $ 11,448,881.00 $ 6,182,659.00 3,757,760.00 $ 2,112,129.00 $ 1,441,847.00 10,869,062.00 $ 9,336,752.00 $ 4,740,812.00 $ 3,472,097.00 $ 2,582,212.00 $ $ 7,396,965.00 $ 6,754,540.00 $ 910,560.00 3,830,252.00 ASSETS 1999 1998 1997 CURRENT ASSETS Account Receivables Inventory Prepaid Expenses $ TOTAL CURRENT ASSET $ $ 17,984,549.00 $ $ 14,403,613.00 $ 1,743,855.00 S 34,132,017.00 S 1,302,311.00 $ 10,298,798.00 $ 10,341,943.00 11,972,472.00 S 8,466,950.00 473.105.00 23,573,581.00 $ 19,281,998.00 51,906,121.00 $ 45,739,021.00 $ 37,996,242.00 $ 82,032,619.00 $ 36,342,108.00 $ 13,979,640.00 $ 133,938,740.00 S 82,081,129.00 $ 51,975,882.00 FIXED ASSETS Fixed Assets $ Intangible Assets TOTAL FIXED ASSET TOTAL ASSETS LIABILITIES AND SHAREHOLDERS EQUITY CURRENT LIABILITIES $ 168,070,757.00 $ 105,654,710.00 $ 71,257,880.00 1999 S $ 1998 1997 2,546,774.00 S 280,606.00 17,483,060.00 $ 14,028,903.00 Bank Indebtedness Accounts Payable Current Portion of Long-Term Debt TOTAL CURRENT LIABILITIES LONG TERM LIABILITIES Long-Term Debt TOTAL LIABILITIES SHAREHOLDERS' EQUITY Capital Stock Retained Earnings TOTAL SHAREHOLDERS' EQUITY TOTAL LIABILITIES&SHAREHOLDERS' EQUITY 8,446,455.00 $ 16,316,278.00 $ S 6,699,452.00 $ $ 31,462,185.00 $ 4,744,880.00 $ 3,821,768.00 24,774,714.00 $18,131,277.00 S 76,630,277.00 $ 29,465,021.00 $ 20,665,713.00 $ 108,092,462.00 $ 54,239,735.00 $38,796,990.00 1999 1998 $ 39,476,303.00 $ 1997 38,309,948.00 $ 26,110,403.00 $ 20,501,992.00 $ 13,105,027.00 $ 6,350,487.00 $ 59,978,295.00 $ 51,414,975.00 $ 32,460,890.00 168,070,757.00 $ 105,654,710.00 $ 71,257,880.00 Given that the market for beer is stabilising, sales growth prospects for Sleeman Breweries Ltd are uncertain and growth by acquisition is not likely in the next 3 years. Chantel expects that sales will increase by 5% per year over the next 3 years. She also noticed that the new loan to pay for the acquisition of Stroh will have to be paid off over the next 10 years and assumes that an interest rate of 8% on all long term debt is reasonable. Given these estimates (a) Project the income statement and balance sheet for Sleeman Breweries Ltd for the next 3 years (b) Identify the key assumptions used in your projections and demonstrate how they could impact on the financial situation of the company