Finance 3313 Worksheet 14 Last Updated, April 11, 2016 Exercise: The percent of sales method, Case: Jim's Espresso Jim's expects sales to grow by 10% next year. Assume that Jim's pays out 90% of its net income. Using the percent of sales method, forecast financial statements. What is the amount of net new financing needed for Jim's? Jim's Es resso Income Statement and Balance Sheet Income Statement: Balance Sheet Sales 200,000 Assets Costs except Depr. (100,000) Cash and Equivalents 15,000 EBITDA 100,000 Accounts Receivable 2,000 De u reciation (6,000) Inventories 4,000 EBIT 94,000 Total Current Assets 21,000 Interest Expense (net) (400) Property Plant and Equipment 10,000 Pretax Income 93,600 Total Assets 31,000 Income Tax (32,760) Net Income 60,840 Liabilities and Equity Accounts Payable 1,500 Debt 4,000 Total Liabilities 5,500 Stockholders' Equity 25,500 Total Liabilities and Equity 31,000