The most recent financial statements for Crosby, Incorporated, appear below. Interest expense will remain constant; the tax rate and the dividend payout rate also will remain constant. Costs, other expenses, current assets, fixed assets, and accounts payable increase spontaneously with sales. Assume the firm is operating at full capacity and the debt-equity ratio is held constant. CROSBY, INCORPORATED 2021 Income Statement Sales $ 764,000 Costs 620,000 Other expenses 29,500 Earnings before interest and taxes $ 114,500 Interest expense 14,400 Taxable income $ 100,100 Taxes (21%) 21,021 Net income $ 79,079 Dividends $ 36,540 Addition to retained earnings 42,539 CROSBY, INCORPORATED Balance Sheet as of December 31, 2021 Assets Liabilities and Owners’ Equity Current assets Current liabilities Cash $ 25,340 Accounts payable $ 61,800 Accounts receivable 34,770 Notes payable 17,900 Inventory 71,510 Total $ 79,700 Total $ 131,620 Long-term debt $ 112,000 Owners’ equity Fixed assets Common stock and paid-in surplus $ 107,000 Net plant and equipment $ 221,000 Retained earnings 53,920 Total $ 160,920 Total assets $ 352,620 Total liabilities and owners’ equity $ 352,620 Complete the pro forma income statements below. (Do not round intermediate calculations and round your answers to the nearest whole number, e.g., 32.) Calculate the EFN for 10, 15 and 40 percent growth rates. (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answers to the nearest whole number, e.g., 32.)

Advanced Engineering Mathematics

10th Edition

ISBN:9780470458365

Author:Erwin Kreyszig

Publisher:Erwin Kreyszig

Chapter2: Second-order Linear Odes

Section: Chapter Questions

Problem 1RQ

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Question

The most recent financial statements for Crosby, Incorporated, appear below. Interest expense will remain constant; the tax rate and the dividend payout rate also will remain constant. Costs, other expenses, current assets, fixed assets, and accounts payable increase spontaneously with sales. Assume the firm is operating at full capacity and the debt-equity ratio is held constant.

CROSBY, INCORPORATED
2021 Income Statement
Sales		$ 764,000
Costs		620,000
Other expenses		29,500

Earnings before interest and taxes		$ 114,500
Interest expense		14,400

Taxable income		$ 100,100
Taxes (21%)		21,021

Net income		$ 79,079

Dividends	$ 36,540
Addition to retained earnings	42,539

CROSBY, INCORPORATED
Balance Sheet as of December 31, 2021
Assets		Liabilities and Owners’ Equity
Current assets		Current liabilities
Cash	$ 25,340	Accounts payable	$ 61,800
Accounts receivable	34,770	Notes payable	17,900

Inventory	71,510	Total	$ 79,700

Total	$ 131,620	Long-term debt	$ 112,000

		Owners’ equity
Fixed assets		Common stock and paid-in surplus	$ 107,000
Net plant and equipment	$ 221,000	Retained earnings	53,920

		Total	$ 160,920

Total assets	$ 352,620	Total liabilities and owners’ equity	$ 352,620

Complete the pro forma income statements below. (Do not round intermediate calculations and round your answers to the nearest whole number, e.g., 32.)

Calculate the EFN for 10, 15 and 40 percent growth rates. (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answers to the nearest whole number, e.g., 32.)

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