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You have been given the following information for Kellygirls Athletic Wear Corp. for the year 2015: a. Net sales = $38,350,000. b. Cost of goods
You have been given the following information for Kellygirls Athletic Wear Corp. for the year 2015: | |
a. | Net sales = $38,350,000. |
b. | Cost of goods sold = $22,110,000. |
c. | Other operating expenses = $5,300,000. |
d. | Addition to retained earnings = $1,199,500. |
e. | Dividends paid to preferred and common stockholders = $1,915,500. |
f. | Interest expense = $1,795,000. |
g. | The firms tax rate is 30 percent. |
h. | In 2016, net sales are expected to increase by $9.35 million. |
i. | Cost of goods sold is expected to be 60 percent of net sales. |
j. | Depreciation and other operating expenses are expected to be the same as in 2015. |
k. | Interest expense is expected to be $2,070,000. |
l. | The tax rate is expected to be 30 percent of EBT. |
m. | Dividends paid to preferred and common stockholders will not change. |
Calculate the addition to retained earnings expected in 2016. |
Addition to retained earnings | $ |
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