Question

eBook At the end of last year, Roberts Inc. reported the following income statement (in millions of dollars): Sales $3,000 Operating costs excluding depreciation 2,450 EBITDA $550 Depreciation 250 EBIT $300 Interest 124 EBT $176 Taxes (25%) 44 Net income $132 Looking ahead to the following year, the company's CFO has assembled this information: Year-end sales are expected to be 11% higher than the $3 billion in sales generated last year. Year-end operating costs, excluding depreciation, are expected to equal 80% of year-end sales. Depreciation is expected to increase at the same rate as sales. Interest costs are expected to remain unchanged. The tax rate is expected to remain at 25%. On the basis of that information, what will be the forecast for Roberts' year-end net income? Enter your answer in millions. For example, an answer of $25,400,000 should be entered as 25.40. Do not round intermediate calculations. Round your answer to two decimal places.

$ million

Answer 1

Given Information can be tabulated as an income statement as below

Draft Income Statement of Roberts INC for the year
Particulars	$ in Million
	Current Year	Previous Year
Sales	3,330.00	3,000.00
Operating Costs	2,664.00	2,450.00
EBIDTA	666.00	550.00
Depreciation	277.50	250.00
EBIT	388.50	300.00
Interest	124.00	124.00
EBT	264.50	176.00
Taxes @ 25%	66.13	44.00
Net Income	198.38	132.00

Hence the net income would be $198.38 Million