Tom’s Landscaping Company has noted sales revenues for 2016 to be $1.5 million

What-If Analysis with Two Variables

GIVEN:

Tom’s Landscaping Company has noted sales revenues for 2016 to be $1.5 million.
Management expects a growth rate in Sales to be 3.5% for 2017 but also expects 75%
of Sales Revenues to be Operating Expenses.

REQUIRED:

1. What are the Projected Sales for 2017 under this growth rate scenario?

2. What are the various Projected Operating Incomes should expected sales

growth be anywhere from 2% up to and including 8% (for every half percent)

and expenses varying from 60% to 85% (for every 5% change)?

OI Projected for 2017:
Sales for 2016	$ 1,500,000
Growth for 2017	3.5%
Projected Expenses for 2017	75%
Projected Sales for 2017	$ 1,552,500
Projected OI for 2017	$ 388,125	60%	65%	70%	75%	80%	85%
	2%	$ 612,000	$ 535,500	$ 459,000	$ 382,500	$ 306,000	$ 229,500
	2.5%	$ 615,000	$ 538,125	$ 461,250	$ 384,375	$ 307,500	$ 230,625
	3%	$ 618,000	$ 540,750	$ 463,500	$ 386,250	$ 309,000	$ 231,750
	3.5%	$ 621,000	$ 543,375	$ 465,750	$ 388,125	$ 310,500	$ 232,875
	4%	$ 624,000	$ 546,000	$ 468,000	$ 390,000	$ 312,000	$ 234,000
	4.5%	$ 627,000	$ 548,625	$ 470,250	$ 391,875	$ 313,500	$ 235,125
	5%	$ 630,000	$ 551,250	$ 472,500	$ 393,750	$ 315,000	$ 236,250
	5.5%	$ 633,000	$ 553,875	$ 474,750	$ 395,625	$ 316,500	$ 237,375
	6%	$ 636,000	$ 556,500	$ 477,000	$ 397,500	$ 318,000	$ 238,500
	6.5%	$ 639,000	$ 559,125	$ 479,250	$ 399,375	$ 319,500	$ 239,625
	7%	$ 642,000	$ 561,750	$ 481,500	$ 401,250	$ 321,000	$ 240,750
	7.5%	$ 645,000	$ 564,375	$ 483,750	$ 403,125	$ 322,500	$ 241,875
	8%	$ 648,000	$ 567,000	$ 486,000	$ 405,000	$ 324,000	$ 243,000

Tom’s Landscaping Company has noted sales revenues for 2016 to be $1.5 million

What-If Analysis with Two Variables

GIVEN:

REQUIRED:

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