9. Calculating Retained Earnings from Pro Forma Income [LO1] Consider the following income statement for the Heir Jordan Corporation: HEIR JORDAN CORPORATION Income Statement Sales Costs Taxable income Taxes (22%) Net income Dividends Addition to retained earnings $2,400 4,386 $49,000 40,300 $ 8,700 1,914 $ 6,786 A 20 percent growth rate in sales is projected. Prepare a pro forma income statement assuming costs vary with sales and the dividend payout ratio is constant. What is the projected addition to retained earnings?
9. Calculating Retained Earnings from Pro Forma Income [LO1] Consider the following income statement for the Heir Jordan Corporation: HEIR JORDAN CORPORATION Income Statement Sales Costs Taxable income Taxes (22%) Net income Dividends Addition to retained earnings $2,400 4,386 $49,000 40,300 $ 8,700 1,914 $ 6,786 A 20 percent growth rate in sales is projected. Prepare a pro forma income statement assuming costs vary with sales and the dividend payout ratio is constant. What is the projected addition to retained earnings?
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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![9. Calculating Retained Earnings from Pro Forma Income [LO1] Consider the
following income statement for the Heir Jordan Corporation:
HEIR JORDAN CORPORATION
Income Statement
Sales
Costs
Taxable income
Taxes (22%)
Net income
Dividends
Addition to retained earnings
$2,400
4,386
$49,000
40,300
$ 8,700
1,914
$ 6,786
A 20 percent growth rate in sales is projected. Prepare a pro forma income statement
assuming costs vary with sales and the dividend payout ratio is constant. What is the
projected addition to retained earnings?](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F316a7423-337f-44d9-b890-d8b19bac3451%2F480663be-89be-44da-b309-d305f0808d73%2Fp9zmik_processed.jpeg&w=3840&q=75)
Transcribed Image Text:9. Calculating Retained Earnings from Pro Forma Income [LO1] Consider the
following income statement for the Heir Jordan Corporation:
HEIR JORDAN CORPORATION
Income Statement
Sales
Costs
Taxable income
Taxes (22%)
Net income
Dividends
Addition to retained earnings
$2,400
4,386
$49,000
40,300
$ 8,700
1,914
$ 6,786
A 20 percent growth rate in sales is projected. Prepare a pro forma income statement
assuming costs vary with sales and the dividend payout ratio is constant. What is the
projected addition to retained earnings?
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