PLEASE TURN IT INTO EXCEL SHEET

1. Vitos Tavern had $262,000 in 2019 taxable income. What is the taxable income? (5 Points)

2. During the year, Vitos Tavern had gross sales of $1,200,000. Costs of Goods sold was $672,000, selling and administrative expenses were $212,000. Vito Tech also had notes payable (liability) of $750,000 at an interest rate of 3%. Depreciation was $110,000 and the company is in a 35% tax bracket. What is Vito Techs net income and operating cash flow? (10 Points)

3. The most recent financial statements for Vitos Tavern are as follows:

Income Statement

Sales $55,000

Costs $40,000

Taxable Income $15,000

Taxes (28%) $4,200

NI $10,800

Balance Sheet

Current Assets $40,000 Long-Term Debt $60,000

Fixed Assets $100,000 Equity $75,000

Total $140,000 Total $135,000

Assets and costs are proportional to sales. Beakman maintains a 10% dividend payout ratio and a constant debt-equity ratio. What is the maximum increase in sales that can be sustained assuming no new equity is issued? (10 Points)

4. If Vitos Tavern has a ROE of 10% and a payout ratio of 7%, what is its sustainable growth rate? (8 Points)