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Thank you so much for answer! Forecast the financial statements for Year 6 based on the Year 5 historic financial statements and the assumptions listed
Thank you so much for answer!
Forecast the financial statements for Year 6 based on the Year 5 historic financial statements and the assumptions listed below. Then answer the questions that follow. 1. Sales growth = 5% 2. Cost of debt = 5.75% 3. Tax rate = 29% 4. Depreciation rate = 15.37% 5. CAPEX = $190,605 6. Accounts held constant: goodwill & intangibles, short-term debt, other current liabilities, common stock 7. Long-term debt is the plug account. 8. No dividends Income Statement and Balance Sheet As of December 31st, Year 5 ($000s) Year 5 Ratios Year 6 Revenue 7,069,736 Operating Expenses: Cost of Goods Sold 3,982,323 0.563292 SG&A 2,767,377 0.391440 Depreciation Expense 190,669 Total Operating Expenses 6,940,369 EBIT 129,367 Interest Expense 45,681 Earnings Before Taxes 83,686 Provision for Income Taxes 23,948 Net Income 59,738 Year 5 Ratios Year 6 Cash and Securities 328,060 0.046403 Accounts Receivable 546,940 Inventories 1,412,320 Total Current Assets 2,287,320 Property, Plant, & Equipment Net 1,049,505 Goodwill & Intangibles 671,996 671,996 Total Assets 4,008,821 Short-Term Debt 226,370 226,370 Accounts Payable 417,376 Other 455,699 455,699 Total Current Liabilities 1,099,445 Long-Term Debt 608,712 Total Liabilities 1,708,157 Stockholders' Equity Common Stock 1,482,444 1,482,444 Retained Earnings 718,220 Total Stockholders' Equity 2,200,664 Total Liabilities and Stockholders' Equity 4,008,821 PART 1 What is the depreciation expense in Year 6? O $190,669 O $190,605 O $193,558 O $161,309 PART 2 What is the interest expense in Year 6? O $41,417 0 $42,662 O $45,681 O $48,017 PART 3 What is net PP&E in Year 6? O $949,500 O $1,049,505 O $1,240,110 O $858,900 PART 4 What are retained earnings for Year 6? O $787,385 O $718,200 O $752,610 O $669,165 PART 5 What is long-term debt for Year 6? O $1,853,358 O $815,636 O $733,044 O $1,233,044Step by Step Solution
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