PRO FORMA INCOME STATEMENT At the end of last year, Roberts Inc. reported the fo

Question

PRO FORMA INCOME STATEMENT At the end of last year, Roberts Inc. reported the following income statement (in millions of dollars) Sales Operating costs excluding depreciation 2,450 EBITDA Depreciation EBIT Interest EBT Taxes (40%) Net income Looking ahead to the following year, the company's CFO has assembled this information $3,000 $550 250 $300 125 $175 70 $105 Year-end sales are expected to be 8% higher than the $3 billion in sales generated last year Year-end operating costs, excluding depreciation, are expected to equal 75% of year-end sales Depreciation is expected to increase at the same rate as sales Interest costs are expected to remain unchanged The tax rate is expected to remain at 40% On the basis of that information, what will be the forecast for Roberts' year-end net income? Enter your answer in millions. For example, an answer of $25,000,000 should be entered as 25. Round your answer to two decimal places million

Explanation / Answer

Forcasted year end Net Income is $249 million

Previous Year Increase(%) Current Year Sales 3000 8% 3240 (-)Operating Cost including depreciation 2450 2430 EBITDA 550 810 (-)Depreciation 250 8% 270 EBIT 300 540 (-)Interest 125 125 EBT 175 415 (-)Taxes(40%) 70 166 Net Income 105 249

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