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

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter14: Capital Structure Management In Practice

Section: Chapter Questions

Problem 2P

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