Textbook Problem

PRO FORMA INCOME STATEMENT At the end of last year, Roberts Inc. reported the following income statement (in millions of dollars):

Sales	$3,000
Operating costs excluding depreciation	2,450
EBITDA	$ 550
Depreciation	250
EBIT	$ 300
Interest	125
EBT	$ 175
Taxes (40%)	70
Net income	$ 105

Looking ahead to the following year, the company’s CFO has assembled this information:

• Year-end sales are expected to be 10% higher than the $3 billion in sales generated last year.

• Year-end operating costs, excluding depreciation, are expected to equal 80% of year-end sales.

• Depreciation is 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 that information, what will be the forecast for Roberts’ year-end net income?