Austin Grocers recently reported the following 2008 income statement (in millions of dollars): Sales $700 875 Operating Costs including depreciation 500 612.50 $200 262.50 EBIT Interest 40 40 EBT $160 222.50 Таxes (40%) 64 89.00 Net income $ 96 133.50 This year the company is forecasting a 25% increase in sales; and it expects that its year-end operating costs, including depreciation, will equal 70% of sales. Austin's tax rate and interest expense are all expected to remain constant. 1. What is Austin's projected 2009 net income?a. 133.50 b. 96.00 c. 207.00 d. 158.50 2. What is Austin's projected 2009 earnings before interest and taxes (EBIT) а. 200.00 b. 262.50 c. 385.00 d. 375.00 3. What is Austin's projected 2009 sales? a. 700.00 b. 175.00 c. 875.00 d. 500.00
Austin Grocers recently reported the following 2008 income statement (in millions of dollars): Sales $700 875 Operating Costs including depreciation 500 612.50 $200 262.50 EBIT Interest 40 40 EBT $160 222.50 Таxes (40%) 64 89.00 Net income $ 96 133.50 This year the company is forecasting a 25% increase in sales; and it expects that its year-end operating costs, including depreciation, will equal 70% of sales. Austin's tax rate and interest expense are all expected to remain constant. 1. What is Austin's projected 2009 net income?a. 133.50 b. 96.00 c. 207.00 d. 158.50 2. What is Austin's projected 2009 earnings before interest and taxes (EBIT) а. 200.00 b. 262.50 c. 385.00 d. 375.00 3. What is Austin's projected 2009 sales? a. 700.00 b. 175.00 c. 875.00 d. 500.00
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
Related questions
Question
Please show your solutions.
Transcribed Image Text:Austin Grocers recently reported the following 2008 income
statement (in millions of dollars):
Sales
$700
875
Operating Costs including depreciation 500 612.50
EBIT
$200 262.50
Interest
40
40
EBT
$160 222.50
Taxes (40%)
89.00
Net income
$ 96 133.50
This year the
and it expects that its year-end operating costs, including
depreciation, will equal 70% of sales. Austin's tax rate and
interest expense are all expected to remain constant.
company
is forecasting a 25% increase in sales;
1. What is Austin's projected 2009 net income?a. 133.50
b. 96.00
c. 207.00
d. 158.50
2. What is Austin's projected 2009 earnings before interest and
taxes (EBIT)
a. 200.00
b. 262.50
c. 385.00
d. 375.00
3. What is Austin's projected 2009 sales?
a. 700.00
b. 175.00
c. 875.00
d. 500.00
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 2 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.Recommended textbooks for you
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
Foundations Of Finance
Finance
ISBN:
9780134897264
Author:
KEOWN, Arthur J., Martin, John D., PETTY, J. William
Publisher:
Pearson,
Fundamentals of Financial Management (MindTap Cou…
Finance
ISBN:
9781337395250
Author:
Eugene F. Brigham, Joel F. Houston
Publisher:
Cengage Learning
Corporate Finance (The Mcgraw-hill/Irwin Series i…
Finance
ISBN:
9780077861759
Author:
Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor
Publisher:
McGraw-Hill Education