Answer:
Explanation:
Present 20% growth
Sales 751,000 901,200
Cost 586,000 703,200
Other Expenses 22,000 26,400
EBIT 143,000 171,600
Interest paid 18,000 18,000
Taxable income 125,000 153,600
Taxes 50,000 61,440
Net income 75,000 92160
Dividends 30,000 36,864
Transfer to retained Earn 45,000 55,296
The new retained earning = 55,296+41,120 = 96,416
Proforma Balanced sheet
Current asset
Cash = 21040*1.2 25,248
Account receivables 33,360*1.2 40,032
Inventory 70,320*1.2 84,384
Total 149,664
Non current asset
Fixed asset
Plant & equipment 240000*1.2 288,000
Total assets 437,664
Total Liabilities & owners equity
Current liabilities
Accounts payable= 55,200*1.2 66,240
Note payable 14,400
Total current liabilities 80,640
Non current liabilities
Long term debts 134,000
Total non current liabilities 134,000
Shareholders equity
Common stock 120,000
Retained earnings 96,416
Total shareholder equity 216,416
Total liabilities & equities 431,056
EFN = total asset - total liabilities
437,664 - 431,056 =$ 6,608
