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Pro forma. You are a financial analyst that has been hired to forecast the possible funding need for a company based on its financial information

Pro forma. You are a financial analyst that has been hired to forecast the possible funding need for a company based on its financial information and future plans.

You know that the net property, plant, and equipment at the end of 2018 was $25,000K and it currently equals $30,000K. Long-term debt at the end of 2018 was $15,000K and it currently equals $17,000K.

You assumed that sales will decreased by 10 percent. Given the companys recent income statement, you constructed the pro forma below:

Net Income Statement, Fiscal Year End 2019 (in thousands of $)

Proforma

Ratio

assumptions

Sales

30000

27000

(30000 x0.9)

PPE 2018 = 25,000

Cost of Goods Sold

20000

18000

PPE 2019 = 30,000

Depreciation

3000

3600

LT DEBT 2018 = 15,000

EBIT

7000

5400

LT DEBT 2019 = 17,000

Interest Expense

1200

1360

Pre-Tax Income

5800

4040

Tax

870

606

Net Income

4930

3434

Report the ratios for the Cost of Goods Sold, Depreciation, Interest Expense, and Tax that you used to construct the pro-forma net income statement for fiscal year end 2020.

Report your answers as follows. Report each ratio as 0.XX. For example, a ratio of 30/90 would be reported 0.33 and a ratio of 100/500 would be reported as 0.20 .

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