Question

Consider the following income statement for the Heir Jordan Corporation:

The balance sheet for the Heir Jordan Corporation follows.

Consider the following income statement for the Heir Jordan Corporation: EIR JORDAN CORPORATION Income Statement Sales Cost $49,000 40,300 Taxable income Taxes (22%) 8,700 1,914 Net income 6,786 Dividends Addition to retained $2,400 4,386 earnings The balance sheet for the Heir Jordan Corporation follows HEIR JORDAN CORPORATION Balance Sheet Assets Liabilities and Owners' Equity Current liabilities Current assets $2,950 Accounts payable 4,100 Notes payable Cash Accounts 2.400 5,400 $ 7800 $28,000 receivable Inventory 6,400Total Total $13,450 Long-term debt Owners' equity Common stock and paid $ 15,000 3,950 $ 18,950 $ 54,750 Fixed assets in surplus Net plant and equipment $41,300 Retained earnings Total $54,750 Total liabilities and Total assets owners' equity

Prepare a pro forma balance sheet, assuming a sales increase of 15 percent, no new external debt or equity financing, and a constant payout ratio. (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)

Calculate the EFN. (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)

Answer 1