Service

Chat Now

The management of Coker Corp. is doing a quick forecast of 20X9using the modified percenta

The management of Coker Corp. is doing a quick forecast of 20X9using the modified percenta

The management of Coker Corp. is doing a quick forecast of 20X9using the modified percentage of sales method in preparation for amore detailed planning exercise later in the month. The estimate isto assume a 11% growth in sales. All other line items are to beassumed to grow at the same rate except for fixed assets which isprojected to increase by $92,000 due to an expansion programalready underway. Approximate financial statements for the currentyear, 20X8, and a planning worksheet are shown below. The firm pays9% interest on all of its debt. Assume the tax rate is a flat 25%.There are no plans for dividends or the sale of additional stocknext year. Make a forecast of Coker's complete income statement andbalance sheet. Enter your answers in thousands. For example, ananswer of $12 thousands should be entered as 12, not 12,000.(Hints: The easiest way to grow a number by 11% is to multiply itby 1.11 rather than taking 11% and adding. Do not grow subtotals.For example, to grow Revenue and COGS by 11%, round each to thenearest thousand and subtract for Gross Margin. Don't growinterest, debt, or equity; use the debt/interest iterationtechnique.) Round your answers to the nearest whole thousand. Enterall amounts as a positive numbers.

CokerCorp.

Current andProjected Income Statements

($000)

 

 

20X8

 

20X9

Revenue

 

$624

 

$  

COGS

 

300

 

 

Gross Margin

 

$324

 

$  

Expenses

 

146

 

 

EBIT

 

178

 

 

Interest (9%)

 

33

 

 

EBT

 

$145

 

$  

Inc Tax (25%)

 

  36

 

 

Net Income

 

$109

 

$  

         

 

CokerCorp.

Current andProjected Balance Sheets

($000)

ASSETS

 

LIABILITIES& EQUITY

 

 

20X8

 

20X9

 

 

 

20X8

 

20X9

C/A

 

$103

 

$  

 

C/L

 

$   83

 

$  

F/A

 

554

 

 

 

Debt

 

399

 

 

Total

 

$657

 

$  

 

Equity

 

175

 

 

 

 

 

 

 

 

Total

 

$657

 

$  

Abhinav 02-Dec-2019

Answer (UnSolved)

question Get solution