Author Question: Blockbuster is a video rental and retail chain. Blockbuster is forecasting its financial statements ... (Read 196 times)

Wadzanai · **on:** Apr 25, 2021

Blockbuster is a video rental and retail chain. Blockbuster is forecasting its financial statements for Year 3. Selected financial information for Year 2 is provided in the table. What is Retained Earnings for Year 3?

Selected Financial Information

Blockbuster Inc. ($ '000)

	Year 2	Ratios (to Sales)	Forecast Year 3
Revenue	$5,157,600		$5,673,360
COGS	2,420,700	0.469346
SG&A	2,532,400	0.491004
R&D	176,100	0.034144
Dep. Exp.	246,600		300,000
EBIT	-218,200
Int. Exp.	78,200		78,000
EBT	-296,400
Provision for Income Taxes	-56,100	0.19*
Net Income	$ -240,300
Dividends			$0
Retained Earnings	$ -327,100
Owner's Equity	$ -427,100

*Tax rate is a proportion of Earnings before Taxes.
◦ $-46,224
◦ $-47,279
◦ $-329,300
◦ $-607,976
◦ $-707,976

stallen · **Reply #1 on:** Apr 25, 2021

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