Sales	$8,800
Less: Costs	5,000
Depreciation	900
EBIT	2,900
Less: Interest	350
EBT	2,550
Taxes	850
Net Income	$1,700

Bo Knows Profit Corporation

Balance Sheets for End of Years 2010, 2011

	2011	2010		2011	2010
Cash	110	170	Accounts Payable	120	135
Accounts Receivable	700	500	Notes Payable	1,400	1,200
Inventory	1,000	1,240	Current Liabilities	1,520	1,335
Current Assets	1,810	1,910	Long-term Debt	2,620	2,005
Fixed Assets	3,500	2,000	Common Stock	200	100
			(50 shares)
			Retained Earnings	970	470
Total Assets	5,310	3,910	Total Liab. & Equity	5,310	3,910

Financial Data:

1) Assume that sales will grow by 20%.

2) Accounts Receivable will represent 15% of sales.

3) Inventory is expected to be 20% of sales.

4) Bo Knows will purchase $500 in fixed assets and book $640 in depreciation.

5) All other spontaneous accounts will grow in proportion to sales.

6) Dividend is expected to remain constant. (Hint: you can find current dividend from historical data)

Given above Income Statement and Balance Sheet for Bo Know only, find the projected EBIT for 2012.

Question 1 options:

	3,920
	3,540
	3,720
	1,968
	3,720

Question 2 (1 point)

1. Find the projected total assets for 2012

Question 2 options:

	7,188
	5,488
	8,028
	6,988
	7,828

Question 3 (1 point)

2. Given above Income Statement and Balance Sheet for Bo Know only, forecast Bo Knows's 1st Pass additional funds needed (AFN) for the coming year.

Question 3 options:

	607
	674
	1,168
	993
	975

Question 4 (1 point)

4. Find the projected addtion to Retained Earning of the second pass.

Question 4 options:

	1,011
	644
	1,141
	661
	989

Question 5 (1 point)

5. Given above Income Statement and Balance Sheet for Bo Know only, forecast Bo Knows's 2nd Pass additional funds needed (AFN) for the coming year.

Question 5 options:

	79
	-15
	35
	17
	39

Answer rating: 100% (QA)

To find the projected EBIT for 2012 we first need to calculate the projected sales for 2012 using the given information Projected Sales for 2012 Sales for 2011 1 Sales Growth Rate 8800 1 020 10560 Nex... View the full answer