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Unformatted text preview: Rutgers University Department of Economics ECON393 (Financial Economics) Assignment 2 Notes 1. This assignment is due on Wednesday, October 19, 2011. 2. You may work in group, (maximum 4) and provide all the members names on the first page. 3. All answers should be typed and written in complete sentences. 4. Please provide your computation process and equations for each ratio analysis. 1. Pro Forma Statements Using the 2010 financial statements of the company that you selected for Assignment 1, find the companys sustainable growth rate. Using the sustainable growth rate that you found above, prepare a pro forma income statement and a pro forma balance sheet for 2011. (Hint: The projected sales will increase at the sustainable growth rate.) For the pro forma I/S, show the following items; sales, costs, operating income (earnings before taxes), interest, taxes, net income, dividends, and addition to R/E....
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This note was uploaded on 10/25/2011 for the course ECON 393 taught by Professor D during the Spring '10 term at Rutgers.
- Spring '10