Consider the following income statement for the Heir Jordan Corporation: A 20 percent growth rate in sales

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Consider the following income statement for the Heir Jordan Corporation:

A 20 percent growth rate in sales is projected. Prepare a pro forma income statement assuming costs vary with sales and the dividend payout ratio is constant. What is the projected addition to retainedearnings?

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Fundamentals of corporate finance

ISBN: 978-0078034633

10th edition

Authors: Stephen Ross, Randolph Westerfield, Bradford Jordan

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Question Posted: Mar 13, 2014 07:57 AM

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Consider the following income statement for the Heir Jordan Corporation: A 20 percent growth rate in sales

Question:

HEIR JORDAN CORPORATION Income Statement Sales Costs Taxable income Taxes (35%) Net income $47,000 31,300 $15,700 5,495 $10,205 $2,500 7,705 Dividends Addition to retained earnings

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Sales 47000 Costs 31300 Taxable income 15700 Taxes 5495 Net inco...View the full answer

Fundamentals of corporate finance

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