Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The most recent financial statements for Hopington Tours Inc. follow. Sales for 2018 are projected to grow by 25%. Interest expense will remain constant; the

image text in transcribed
image text in transcribed
image text in transcribed
The most recent financial statements for Hopington Tours Inc. follow. Sales for 2018 are projected to grow by 25%. Interest expense will remain constant; the tax rate and the dividend payout rate will also remain constant Costs, other expenses, current assets, and accounts payable increase spontaneously with sales. The firm is operating at full capacity and no new debt or equity is issued. HOPINGTON TOURS INC 2017 Statement of comprehensive Income Sales $761,000 Costs 596,000 Other expenses 17.000 Earnings before interest and taxes $140,000 Interest paid 18,000 Taxable income $130,000 Taoces (30%) 39,000 Niet income $ 91,000 Dividends $20,800 Addition to retained earnings 70,200 Assets Current assets Cash Accounts receivable Inventory Total HOPINGTON TOURS INC Statenent of Financial Position as of December 31, 2017 Liabilities and Owners Equity Current liabilities $ 27,100 Accounts payable 42,500 Notes payable 88,700 Total $158,300 Long-term debt Owners' equity Common stock and paid in surplus 5380,000 Retained earnings Total $538,300 Total liabilities and owners' equity 5 69,600 18.00 588,600 $144,000 Fixed assets Net plant and equipment $130,000 175,700 $305,700 $530,100 Total assets Complete the pro forma statement of comprehensive income below. (Input all amounts as positive values. Omit $ sign in your response.) HOPINGTON TOURS INC. Pro Forma Statement of Comprehensive Income 25 % Sales Growth Sales $ Costs other expenses EBIT $ Interest Taxable income $ Taxes (30%) Net income $ Dividends $ Add. to RE Complete the pro forma statement of financial position below. Current assets Cash Accounts receivable Inventory Total HOPINGTON TOURS INC. Pro Forma Statement of Financial Position Liabilities and Owners' Equity Current liabilities 5 Accounts payable $ Notes payable $ Total $ Long-tere debt Owners' equity Common stock and paid-in surplus Retained earnings Total Total liabilities and owners' equity $ $ $ $ Fixed assets Net plant and equipment $ $ Total assets $ $ Calculate the EFN for 25% growth rates. 258 $ EFN

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Connect For Computer Accounting With Quickbooks Online

Authors: Donna Kay

2nd Edition

1264152272, 9781264152278

More Books

Students also viewed these Accounting questions

Question

What is the effect of word war second?

Answered: 1 week ago

Question

Recognize and discuss the causes of culture shock

Answered: 1 week ago