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Prepare the Pro Forma Statement of Financial Position as at 31 December 2023 from the Statement of Financial Position and additional information provided below: INFORMATION The financial position of Gatti Limited as at 31 December 2022 is reflected the following statement:

Prepare the Pro Forma Statement of Financial Position as at 31 December 2023 from the Statement of Financial Position and additional information provided below: INFORMATION The financial position of Gatti Limited as at 31 December 2022 is reflected the following statement:

Financial Accounting: The Impact on Decision Makers
Financial Accounting: The Impact on Decision Makers
10th Edition
ISBN:9781305654174
Author:Gary A. Porter, Curtis L. Norton
Publisher:Gary A. Porter, Curtis L. Norton
Chapter9: Current Liabilities, Contingencies, And The Time Value Of Money
Section: Chapter Questions
Problem 9.9E
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REQUIRED Prepare the Pro Forma Statement of Financial Position as at 31 December 2023 from the Statement of Financial Position and additional information provided below: INFORMATION The financial position of Gatti Limited as at 31 December 2022 is reflected the following statement: Statement of Financial Position as at 31 December 2022 ASSETS Non-current assets Property, plant and equipment Fixed deposits Current assets Inventories Accounts receivable Cash and cash equivalents Total assets EQUITY AND LIABILITIES Equity Ordinary share capital Retained earnings Non-current liabilities Long-term loan Current liabilities Accounts payable Total equity and liabilities R 1 400 000 1 200 000 200 000 5 800 000 3 400 000 2 000 000 400 000 7 200 000 4 680 000 3 600 000 1 080 000 720 000 720 000 1 800 000 1 800 000 7 200 000
Transcribed Image Text:REQUIRED Prepare the Pro Forma Statement of Financial Position as at 31 December 2023 from the Statement of Financial Position and additional information provided below: INFORMATION The financial position of Gatti Limited as at 31 December 2022 is reflected the following statement: Statement of Financial Position as at 31 December 2022 ASSETS Non-current assets Property, plant and equipment Fixed deposits Current assets Inventories Accounts receivable Cash and cash equivalents Total assets EQUITY AND LIABILITIES Equity Ordinary share capital Retained earnings Non-current liabilities Long-term loan Current liabilities Accounts payable Total equity and liabilities R 1 400 000 1 200 000 200 000 5 800 000 3 400 000 2 000 000 400 000 7 200 000 4 680 000 3 600 000 1 080 000 720 000 720 000 1 800 000 1 800 000 7 200 000
Additional information The following must be taken into account for 2023: ■ Sales are forecast at R60 000 000, with a profit margin of 10% and a gross margin of 30%. Fifty percent (50%) of the sales is expected to be for cash and the balance is on credit. ■ The debtor collection period is expected to be 36.5 days. All purchases of inventories are expected to be on credit and are estimated to total R48 000 000. The creditor payment period is estimated to be 73 days. ■ Equipment with a cost price of R8 000 000 is expected to be purchased on 01 July 2023. Total depreciation is expected to be R800 000 for the year. The maturity dates of the fixed deposits are as follows: R80 000 01 May 2023 R120 000 31 May 2025 The loan balance is expected to be reduced by R60 000. ■ The directors are expected to recommend a final dividend of R4 000 000, payable during 2024. A bank balance of 1% of sales is desired. Ordinary share capital will remain unchanged. The amount of external non-current funding required must be calculated (balancing figure).
Transcribed Image Text:Additional information The following must be taken into account for 2023: ■ Sales are forecast at R60 000 000, with a profit margin of 10% and a gross margin of 30%. Fifty percent (50%) of the sales is expected to be for cash and the balance is on credit. ■ The debtor collection period is expected to be 36.5 days. All purchases of inventories are expected to be on credit and are estimated to total R48 000 000. The creditor payment period is estimated to be 73 days. ■ Equipment with a cost price of R8 000 000 is expected to be purchased on 01 July 2023. Total depreciation is expected to be R800 000 for the year. The maturity dates of the fixed deposits are as follows: R80 000 01 May 2023 R120 000 31 May 2025 The loan balance is expected to be reduced by R60 000. ■ The directors are expected to recommend a final dividend of R4 000 000, payable during 2024. A bank balance of 1% of sales is desired. Ordinary share capital will remain unchanged. The amount of external non-current funding required must be calculated (balancing figure).
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