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EBK CONTEMPORARY FINANCIAL MANAGEMENT
14th Edition
ISBN: 9781337514835
Author: MOYER
Publisher: CENGAGE LEARNING - CONSIGNMENT
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Please given answer general accounting
![Devaney Convenience recently reported the following 2018 income statement (in millions of
dollars):
Sales
$700
Operating costs including depreciation $500
EBIT
Interest
EBT
Taxes (40%)
Net income
Dividends
$200
$40
$160
$64
$96
$32
$64
Addition to retained earnings
For the coming year, the company is forecasting a 30% increase in sales, and it expects that its
year-end operating costs, including depreciation, will equal 75% of sales. Devaney's tax rate,
interest expense, and dividend payout ratio are all expected to remain constant.
What is Devaney's projected 2019 net income?
a) $112.50
b) $104.00
c) $132.00
d) $222.00
e) $250.00](https://content.bartleby.com/qna-images/question/7d0f04e7-0017-4d18-a5a6-4ffc0c90ce7b/673cf6d6-d234-4e44-9768-f0d046eb9d0b/69873p5_thumbnail.jpeg)
Transcribed Image Text:Devaney Convenience recently reported the following 2018 income statement (in millions of
dollars):
Sales
$700
Operating costs including depreciation $500
EBIT
Interest
EBT
Taxes (40%)
Net income
Dividends
$200
$40
$160
$64
$96
$32
$64
Addition to retained earnings
For the coming year, the company is forecasting a 30% increase in sales, and it expects that its
year-end operating costs, including depreciation, will equal 75% of sales. Devaney's tax rate,
interest expense, and dividend payout ratio are all expected to remain constant.
What is Devaney's projected 2019 net income?
a) $112.50
b) $104.00
c) $132.00
d) $222.00
e) $250.00
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