What assumption is usually made about sales growth at the end of the forecast horizon?
What assumption is usually made about sales growth at the end of the forecast horizon?
Homework Answers
An assumption of steady state is often assumed by analysts after the forecast horizon. The assumption usually made about sales growth is that the sales will grow perpetually along with the long run rate of inflation. The sales however will remain constant in real terms.
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What assumption is usually made about sales growth at the end of
the forecast horizon?
What is meant by the term sales mix? What assumption is usually made concerning sales mix...
What is meant by the term sales mix? What assumption is usually made concerning sales mix in CVP analysis? PLEASE BE VERY DETAILED :)
Use Segment Information to Refine Sales Forecast To forecast sales growth for FY2018 for a publicly...
Use Segment Information to Refine Sales Forecast To forecast sales growth for FY2018 for a publicly traded company in the retail sector, we begin with the following historical sales information. $ millions 2017 2016 2015 2014 2013 Net sales. ................ $46,021 $39,865 $37,536 $36,012 $34,553 Require a. Determine the sales-growth rate (in percentage) for 2014 to 2017. What trend do we observe? b. If we were to use the four-year average sales growth to forecast 2018 sales, what rate would...
What assumption about an object's acceleration is made when deriving the standard kinematic equations? O a...
What assumption about an object's acceleration is made when deriving the standard kinematic equations? O a acceleration is constant No assumption is made oc. acceleration is zero d. acceleration equals 9.8 m/s2 Ob.
One key difference between a company's sales forecast and this firm's sales potential is that: Select...
One key difference between a company's sales forecast and this firm's sales potential is that: Select one: A. The sales forecast is an estimate of sales the firm expects to make under a proposed marketing plan. B. The sales potential must be determined first. C. The sales potential covers the company's entire market, while the forecast is made for individual market segments. D. The sales forecast is usually a larger figure. E. The sales potential assumes that a certain strategic...
The following are forecasted residual operating income (ROPI) for Reed Corporation for 2017: Current Forecast Horizon...
The following are forecasted residual operating income (ROPI) for Reed Corporation for 2017: Current Forecast Horizon Terminal ($millions) 2017 2018 2019 2020 2021 Year Residual operating income (ROPI) $2,499 $2,624 $2,755 $2,893 $3,038 $3,099 Assume a discount rate of 6%, an expected terminal growth rate of 2%, 2017 NOA of $29,896, and 2017 NNO of $17,314. What is the firm's equity value using the ROPI valuation model?
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Zero Industries has made the forecast of sales and the probabilities of sales occurring and are shown in the table below $300,000 $500,000 $600,000 Sales Probabilities 30 .40 .30 The firm has fixed operating costs of $125,000 and variable operating costs are 60 percent of sales. The firm is in the 21 percent marginal tax rate. The firm has total assets that equals $600,000 and anticipates changing to a 30 percent debt ratio. The interest rate on debt is expected...
i) Which of the following is not true about step-growth polymers? Formation of step-growth polymers usually...
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The Optical Scam Company has forecast an 17 percent sales growth rate for next year. The...
The Optical Scam Company has forecast an 17 percent sales growth rate for next year. The current financial statements are shown below. Current assets, fixed assets, and short-term debt are proportional to sales. INCOME STATEMENT Sales $ 44,000,000 Costs 35,200,000 Taxable income $ 8,800,000 Taxes 3,080,000 Net income $ 5,720,000 Dividends $ 1,430,000 Additions to retained earnings $ 4,290,000 BALANCE SHEET Assets Liabilities and Equity Current assets $ 14,040,000 Short-term debt $ 10,560,000 Long-term debt 11,060,000 Fixed assets 37,000,000 Common...
32. (15 points) The Optical Scam Company has forecast a sales growth rate of 20 percent...
32. (15 points) The Optical Scam Company has forecast a sales growth rate of 20 percent for next year The current financial statements are shown below. Assuming that assets, COGS, and short-term carnave the same growth rate as sales, and that the retention ratio does not change, what is the external financing needed for next year? Income Statement Sales COGS 31,700,000 26,426,900 Taxable income Taxes 5,273,100 1,845,585 Net income $ 3,427,515 Dividends Addition to retained earnings $1,371,006 2,056,509 Balance Sheet...
External Funds Needed The Optical Scan Company has forecast a 20 percent sales growth rate for...
External Funds Needed The Optical Scan Company has forecast a 20 percent sales growth rate for next year. The current financial statements are shown here: 3.8 Statement of Comprehensive Income Sales Costs Taxable income Taxes Net income $30,400,000 26,720,000 $ 3,680,000 1,288,000 $ 2,392,000 Dividends Addition to retained earnings $ 956,800 1,435,200 Statement of Financial Position Assets Liabilities and shareholder's equity Current assets 7,200,000 Short-term debt Fixed assets 17,600,000 Long-term debt Common stock $6,400,000 4,800,000 $3,200,000 10,400,000 $13,600,000 $24.800,000 Accumulated...
Use Segment Information to Refine Sales Forecast To forecast sales growth for FY2018 for a publicly traded company in the retail sector, we begin with the following historical sales information. $ millions 2017 2016 2015 2014 2013 Net sales. ................ $46,021 $39,865 $37,536 $36,012 $34,553 Require a. Determine the sales-growth rate (in percentage) for 2014 to 2017. What trend do we observe? b. If we were to use the four-year average sales growth to forecast 2018 sales, what rate would...
What assumption about an object's acceleration is made when deriving the standard kinematic equations? O a acceleration is constant No assumption is made oc. acceleration is zero d. acceleration equals 9.8 m/s2 Ob.
The following are forecasted residual operating income (ROPI) for Reed Corporation for 2017: Current Forecast Horizon Terminal ($millions) 2017 2018 2019 2020 2021 Year Residual operating income (ROPI) $2,499 $2,624 $2,755 $2,893 $3,038 $3,099 Assume a discount rate of 6%, an expected terminal growth rate of 2%, 2017 NOA of $29,896, and 2017 NNO of $17,314. What is the firm's equity value using the ROPI valuation model?
Zero Industries has made the forecast of sales and the probabilities of sales occurring and are shown in the table below $300,000 $500,000 $600,000 Sales Probabilities 30 .40 .30 The firm has fixed operating costs of $125,000 and variable operating costs are 60 percent of sales. The firm is in the 21 percent marginal tax rate. The firm has total assets that equals $600,000 and anticipates changing to a 30 percent debt ratio. The interest rate on debt is expected...
32. (15 points) The Optical Scam Company has forecast a sales growth rate of 20 percent for next year The current financial statements are shown below. Assuming that assets, COGS, and short-term carnave the same growth rate as sales, and that the retention ratio does not change, what is the external financing needed for next year? Income Statement Sales COGS 31,700,000 26,426,900 Taxable income Taxes 5,273,100 1,845,585 Net income $ 3,427,515 Dividends Addition to retained earnings $1,371,006 2,056,509 Balance Sheet...
External Funds Needed The Optical Scan Company has forecast a 20 percent sales growth rate for next year. The current financial statements are shown here: 3.8 Statement of Comprehensive Income Sales Costs Taxable income Taxes Net income $30,400,000 26,720,000 $ 3,680,000 1,288,000 $ 2,392,000 Dividends Addition to retained earnings $ 956,800 1,435,200 Statement of Financial Position Assets Liabilities and shareholder's equity Current assets 7,200,000 Short-term debt Fixed assets 17,600,000 Long-term debt Common stock $6,400,000 4,800,000 $3,200,000 10,400,000 $13,600,000 $24.800,000 Accumulated...
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