elated to financial proje 1) Projected sales are $6,006,000. 2) Cost of goods sold last year includes $998,000 in fixed costs. 3) Operating expense last year includes $246,000 in fixed costs. 4) Interest expense will remain unchanged. 5) The firm will pay cash dividends amounting to 35% of net profits after taxes. 6) Cash and inventories will double. 7) Marketable securities, notes payable, long-term debt, and common stock will remain unchanged. 8) Accounts receivable, accounts payable, and other current liabilities will change in direct response to the change in sales. 9) A new computer system costing $364,000 will be purchased during the year. Total depreciation expense for the year will be $116,00 10) The tax rate will remain at 40%. 1. Prepare a pro forma income statement for next year, using the fixed cost data given to improve the accuracy of the percent-of-sales m . Prepare a pro forma balance sheet for next year, using the information given and the judgmental approach. Include a reconciliation of .Analyze these statements, and discuss the resulting external financing required. Data table (Click on the icon here in order to copy the contents of the data table below into a spreadsheet.) Provincial Imports, Inc. Income Statement for the Year Just Ended Sales revenue $5,006,000 Less: Cost of goods sold Gross profits Less: Operating expenses Operating profits Less: Interest expense 2,741,000 $2,265,000 855,000 $1,410,000 201,000 Pro Forma Balance Sheet $1,209,000 Net profits before taxes Less: Taxes (rate = 40%) A83 G00 483,600 Provincial Imports, Inc. Net profits after taxes $725,400 for Next Year 253,890 $471,510 Less: Cash dividends (Judgmental Method) To retained earnings Accounts payable (Click on the icon here e in order to copy the contents of the data table below into a spreadsheet.) Taxes payable Provincial Imports, Inc. Balance Sheet Notes payable for the Year Just Ended Other current liabilities Assets Liabilities and Stockholders' Equity Cash Marketable securities $190,000 230,000 $700,000 Accounts payable Taxes payable Total current liabilities 95,000 Long-term debt
elated to financial proje 1) Projected sales are $6,006,000. 2) Cost of goods sold last year includes $998,000 in fixed costs. 3) Operating expense last year includes $246,000 in fixed costs. 4) Interest expense will remain unchanged. 5) The firm will pay cash dividends amounting to 35% of net profits after taxes. 6) Cash and inventories will double. 7) Marketable securities, notes payable, long-term debt, and common stock will remain unchanged. 8) Accounts receivable, accounts payable, and other current liabilities will change in direct response to the change in sales. 9) A new computer system costing $364,000 will be purchased during the year. Total depreciation expense for the year will be $116,00 10) The tax rate will remain at 40%. 1. Prepare a pro forma income statement for next year, using the fixed cost data given to improve the accuracy of the percent-of-sales m . Prepare a pro forma balance sheet for next year, using the information given and the judgmental approach. Include a reconciliation of .Analyze these statements, and discuss the resulting external financing required. Data table (Click on the icon here in order to copy the contents of the data table below into a spreadsheet.) Provincial Imports, Inc. Income Statement for the Year Just Ended Sales revenue $5,006,000 Less: Cost of goods sold Gross profits Less: Operating expenses Operating profits Less: Interest expense 2,741,000 $2,265,000 855,000 $1,410,000 201,000 Pro Forma Balance Sheet $1,209,000 Net profits before taxes Less: Taxes (rate = 40%) A83 G00 483,600 Provincial Imports, Inc. Net profits after taxes $725,400 for Next Year 253,890 $471,510 Less: Cash dividends (Judgmental Method) To retained earnings Accounts payable (Click on the icon here e in order to copy the contents of the data table below into a spreadsheet.) Taxes payable Provincial Imports, Inc. Balance Sheet Notes payable for the Year Just Ended Other current liabilities Assets Liabilities and Stockholders' Equity Cash Marketable securities $190,000 230,000 $700,000 Accounts payable Taxes payable Total current liabilities 95,000 Long-term debt
Intermediate Financial Management (MindTap Course List)
13th Edition
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Eugene F. Brigham, Phillip R. Daves
Chapter21: Supply Chains And Working Capital Management
Section: Chapter Questions
Problem 17P: The Raattama Corporation had sales of $3.5 million last year, and it earned a 5% return (after...
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could please explain the solution steps of Pro Forma
Provincial Imports, Inc.
for Next Year
(Judgmental Method)
for example how can I find account payable taxes payable notes payable.....
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