1. For 2007 and 2008 Estimated INCOME STATMENT: (The balance sheet has been done for you already) · Calculate EPS for each scenario ($50 million Debt, Preferred Stock OR Equity) · Each scenario raises...

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1. For 2007 and 2008 Estimated INCOME STATMENT: (The balance sheet has been done for you already) · Calculate EPS for each scenario ($50 million Debt, Preferred Stock OR Equity) · Each scenario raises approximately $50 million. The company plans to reinvest in the business, so there will be no interest income and no change in operating income (EBIT). · Remember that preferred dividends are paid after net income (not tax deductible) but that EPS is calculated on net income available to common shareholders (which is after preferred dividends are paid). · Calculate EBIT/Interest for all three scenarios. new doc 2020-02-24 18.22.40 Scanned with CamScanner Scanned with CamScanner Scanned with CamScanner Scanned with CamScanner Scanned with CamScanner Scanned with CamScanner Scanned with CamScanner Scanned with CamScanner Scanned with CamScanner Scanned with CamScanner Scanned with CamScanner Scanned with CamScanner

granitestudents-1-b5gsiswo.xlsx question-hnko5jsk.docx new-doc-2020-02-24-18224020200224182941-dc45rmgj.pdf

Answered Same DayFeb 25, 2021

Answer To: 1. For 2007 and 2008 Estimated INCOME STATMENT: (The balance sheet has been done for you already) ·...

Khushboo answered on Feb 26 2021

153 Votes

Debt
    Granite Apparel (Create Pro Formas for 2007 and 2008 for Debt scenario)

                                 Pro Forma    Pro Forma
         2006         2007E        2008E        2007E    2008E
    REVENUE    193        289.5        405.3        289.5    405.3
    COGS    -98.4        -144.7        -202.6        -144.7    -202.6
     GP    94.6        144.8        202.7        144.8    202.7
    S,G&A    -67.5        -110        -150        -110    -150
    EBITDA    27.1         34.8         52.7         34.8    52.7
    Depreciation    -5.2        -11.7        -18.3        -11.7    -18.3
    EBIT    21.9         23.1         34.4         23.1    34.4
    Interest    0.5        0.4        0.4        0.4    0.4
    New Interest (*)    0        0        0        3.3    3.0    Shares     200,000
    PreTax    21.4        22.7        34        19.4    31.0    Interest     6.56%
    Tax    6.42         6.81        10.2        5.8    9.3    year
    Net Income    14.98         15.89         23.8         13.6    21.7

    Preferred Dividends    0        0        0        0.0    0.0

    Income Available to Common    14.98        15.89         23.8        13.6    21.7

    SHARES OUTSTANDING    20         20         20        20.00    20.00
    New Shares Issued (if applicable)    0         0         0        0.20    0.20
    Total Shares Outstanding    20         20         20        20.20    20.20

    EPS    $ 0.75         $ 0.79         $ 1.19        $ 0.67    $ 1.08
    EBIT/Interest                            $ 6.28    $ 10.26


    (*) For pro formas, assume that any $50 million cash raised will immediately
    be put to use in the business and may not...

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1. For 2007 and 2008 Estimated INCOME STATMENT: (The balance sheet has been done for you already) · Calculate EPS for each scenario ($50 million Debt, Preferred Stock OR Equity) · Each scenario raises...

Answer To: 1. For 2007 and 2008 Estimated INCOME STATMENT: (The balance sheet has been done for you already) ·...

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