Use the financial information below to construct a 2010 income statement and balance sheets for both...

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Accounting

Use the financial information below to construct a 2010 incomestatement and balance sheets for both 2009 and 2010. The firm’saverage tax rate is 40% and its plowback ratio is 60%. Find thefirms’ cash flows (OCF, NCS, change in NWC, FCF, CFC, CFS).
2009
2010
Sales ($ millions)
1000
1112
Cost of Goods Sold ($ millions)
500
556
Other Expenses ($ millions)
100
111
Depreciation ($ millions)
100
100
Interest Expense ($ millions)
50
55
Total Current Assets ($ millions)
600
700
Accumulated Depreciation
200
300
Net Fixed Assets ($ millions)
1800
2000
Total Current Liabilities ($ millions)
450
550
Long-term Liabilities ($ millions)
900
975
Accumulated Retained Earnings
500
This can be determined from the information given.

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4.0 Ratings (469 Votes)

Income statement Particulars 2010 millions 2009 millions Sales 1112 1000 Less Cost of goods sold 556 500 Other expenses 111 100 Depreciation 100 100 Interest expense 55 50 Profit before taxes 290 250 LessTax at 40 116 100 Profit after taxes 174 150 Balance sheet Particulars See Answer

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	2009	2010
Sales ($ millions)	1000	1112
Cost of Goods Sold ($ millions)	500	556
Other Expenses ($ millions)	100	111
Depreciation ($ millions)	100	100
Interest Expense ($ millions)	50	55
Total Current Assets ($ millions)	600	700
Accumulated Depreciation	200	300
Net Fixed Assets ($ millions)	1800	2000
Total Current Liabilities ($ millions)	450	550
Long-term Liabilities ($ millions)	900	975
Accumulated Retained Earnings	500	This can be determined from the information given.