HELP: pls do
Answer:
\begin{align*}
\text{Year 2 (Forecasted)} \\
\text{Net sales} & : \$15,000,000 \\
\text{Less: Operating costs, except depreciation and amortization} & : \$10,500,000 \\
\text{Less: Depreciation and amortization expenses} & : \$600,000 \\
\text{Operating income (or EBIT)} & : \$3,900,000 \\
\text{Less: Interest expense} & : \$390,000 \\
\text{Pre-tax income (or EBT)} & : \$3,510,000 \\
\text{Less: Taxes (40%)} & : \$1,404,000 \\
\text{Earnings after taxes} & : \$2,106,000 \\
\text{Less: Preferred stock dividends} & : \$100,000 \\
\text{Earnings available to common shareholders} & : \$2,006,000 \\
\text{Less: Common stock dividends} & : \$842,400 \\
\text{Contribution to retained earnings} & : \$1,163,600 \\
\end{align*}
Explanation:
