Estimate the firms net new financing for firm x

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Reference no: EM131926548

Income Statement, 2016		Balance Sheet, 2017
Sales	4,005,000	Assets
Costs except Depr.	-2,995,000	Cash and Equivalents	496,000
EBITDA	1,010,000	Accounts Receivable	660,000
Depreciation	-9,900	Inventories	20,000
EBIT	1,000,100	Total Current Assets	1,176,000
Interest Expense (net)	-40,500	Property Plant & Equipment	1,190,000
Pretax Income	959,600	Total Assets	2,366,000
Income Tax	-335,860	Liabilities &Equity
Net Income	623,740	Accounts Payable	600,000
		Debt	650,000
		Total Liabilities	1,250,000
		Stockholders' Equity	1,116,000
		Total Liabilities and Equity	2,366,000

Use the following Income Statement and Balance Sheet of firm X to answers Questions (1) & (2)

Sales in 2017 are expected to grow at a rate of 12.5% with respect to the values of 2016. Assume the company pays out 65% of its net income.

1. Use the percent sales method to forecast the value of next year's stockholder's equity for firm X.

2. Use the percent sales to estimate the firm's net new financing for firm X.

Reference no: EM131926548

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