Calculate the projected net income in year 5 of the X corp that a forecast using...
Calculate the projected net income in year 5 of the X corp that a forecast using a percentage of sales model expects sales to increase by 15% annually over the next five years, and costs are proportional to sales at 60%. Last year's sales were $3,000.
Homework Answers
Ans $ 2413.63
| YEAR | SALES (15% GROWTH EACH YEAR) | COST (60% OF SALES) | PROFIT (SALES - COST) |
| 0 | 3,000.00 | 1,800.00 | 1,200.00 |
| 1 | 3,450.00 | 2,070.00 | 1,380.00 |
| 2 | 3,967.50 | 2,380.50 | 1,587.00 |
| 3 | 4,562.63 | 2,737.58 | 1,825.05 |
| 4 | 5,247.02 | 3,148.21 | 2,098.81 |
| 5 | 6,034.07 | 3,620.44 | 2,413.63 |
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