3. Calculating Projected Net Income A proposed new investment has projected sales of $635,000. Variable costs are 40 percent of sales, and fixed costs are $168,000; depreciation is $83,000. Prepare a pro forma income statement assuming a tax rate of 23 percent. What is the projected net income?

3. Calculating Projected Net Income A proposed new investment has projected sales of $635,000. Variable costs are 40 percent of sales, and fixed costs are $168,000; depreciation is $83,000. Prepare a pro forma income statement assuming a tax rate of 23 percent. What is the projected net income?

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter12: Capital Budgeting: Decision Criteria

Section: Chapter Questions

Problem 7P: Your division is considering two investment projects, each of which requires an up-front expenditure...

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Question

coaches by 750 units per year. What is the amount to use as the annual sales
figure when evaluating this project? Why?
3. Calculating Projected Net Income A proposed new investment has projected
sales of $635,000. Variable costs are 40 percent of sales, and fixed costs are
$168,000; depreciation is $83,000. Prepare a pro forma income statement
assuming a tax rate of 23 percent. What is the projected net income?
LO 2

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