Sales Operating costs excluding depreciation EBITDA Depreciation EBIT Interest em: At the end of last year, Edwin Inc. reported the following income statement (in millions of dollars): EBT $791.00 Taxes (40%) 316.40 $474.60 Net income Looking ahead to the following year, the company's CFO has assembled this information: • Year-end sales are expected to be 6% higher than $4.3 billion in sales generated last year. • Year-end operating costs, excluding depreciation, will equal 80% of sales. • Depreciation costs are expected to increase at the same rate as sales. . Interest costs are expected to remain unchanged. • The tax rate is expected to remain at 40%. $4,300.00 3,019.00 $1,281.00 340.00 $941.00 150.00 On the basis of this information, what will be the forecast for Edwin's year-end net income? Enter your answers in millions. For example, an answer of $10,550,000 should be entered as 10.55. Enter all values as positive numbers. Do not round intermediate calculations. Round your answers to two decimal places. Sales Operating costs excluding depreciation EBITDA Depreciation EBIT www Interest EBT Taxes Net income (in millions of dollars) $ $ $ $ $
Sales Operating costs excluding depreciation EBITDA Depreciation EBIT Interest em: At the end of last year, Edwin Inc. reported the following income statement (in millions of dollars): EBT $791.00 Taxes (40%) 316.40 $474.60 Net income Looking ahead to the following year, the company's CFO has assembled this information: • Year-end sales are expected to be 6% higher than $4.3 billion in sales generated last year. • Year-end operating costs, excluding depreciation, will equal 80% of sales. • Depreciation costs are expected to increase at the same rate as sales. . Interest costs are expected to remain unchanged. • The tax rate is expected to remain at 40%. $4,300.00 3,019.00 $1,281.00 340.00 $941.00 150.00 On the basis of this information, what will be the forecast for Edwin's year-end net income? Enter your answers in millions. For example, an answer of $10,550,000 should be entered as 10.55. Enter all values as positive numbers. Do not round intermediate calculations. Round your answers to two decimal places. Sales Operating costs excluding depreciation EBITDA Depreciation EBIT www Interest EBT Taxes Net income (in millions of dollars) $ $ $ $ $
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
Solve this practice problem
Transcribed Image Text:Quantitative Problem: At the end of last year, Edwin Inc. reported the following income statement (in millions of dollars):
$4,300.00
3,019.00
$1,281.00
340.00
$941.00
150.00
$791.00
316.40
$474.60
Looking ahead to the following year, the company's CFO has assembled this information:
Sales
Operating costs excluding depreciation
EBITDA
Depreciation
EBIT
Interest
EBT
Taxes (40%)
Net income
▪ Year-end sales are expected to be 6% higher than $4.3 billion in sales generated last year.
▪ Year-end operating costs, excluding depreciation, will equal 80% of sales.
▪ Depreciation costs are expected to increase at the same rate as sales.
▪ Interest costs are expected to remain unchanged.
▪ The tax rate is expected to remain at 40%.
On the basis of this information, what will be the forecast for Edwin's year-end net income? Enter your answers in millions. For example, an answer of $10,550,000 should be entered as 10.55. Enter all values as positive numbers. Do not round
intermediate calculations. Round your answers to two decimal places.
Sales
Operating costs excluding depreciation
EBITDA
Depreciation
EBIT
Interest
EBT
Taxes
Net income
(in millions of dollars)
$
$
$
$
$
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 3 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