Provincial imports has assembled 2015 financial statement income and balance she

Question

Provincial imports has assembled 2015 financial statement income and balance sheet and financial projections for use in preparing financial plans for the coming year 2016
2015 statement Sales revenue 4,996,000 Less costs of goods sold 2752,000 Gross profits 2,244,000 Less operating expense 850,000 Operating profits 1,394,000 Less interest expense 209,000 Net profits before taxes 1,185,000 Less tax ( rate 40%) 474,000 Net profits after tax 711,000 Less cash dividends 248,850 To retained earnings 462,150

Info related to financial projections for 2016 is 1: projected sales are 6,008,000 2: cost of goods sold in 2015 include 1,001,000 in fixed costs 3: operating expense in 2015 include 252,000 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 costing 351,000 will be purchased during the year. Total depreciation for the year will be 104,000 10: the tax rate will remain at 40%
Prepare a pro forma for year ended December 31 2016 using fixed cost data to improve the accuracy of the percent of sales method Sales Less cost of goods sold= Gross profits= Less operating expenses= Operating profits= Less interest expenses = Net profit before taxes = Less tax rate (40%)= Net profits after taxes = Less cash dividends (35%)= To retained earmings=
Prepare a pro forma balance sheet as of dec 31 2016 using info given and judgemental approach. Include a reconciliation of the retained earnings acct. NOTE taxes payable for 2016 are about 20.0422% of the 2015 taxes on the income statement . The pro forma value is obtained by taking 20.0422% of the 2016 taxes . Complete the assets of the pro forma balance sheet as of dec 31 2016 Cash= Marketable securities = Acct receivable = Inventories= Total current assets= Net fixed assets = Total assets=complete liabilities and equity part of pro forma balance sheet as of December 31 2016 ( judgemental method) Accounts payable = Taxes payable = Notes payable= Other current liabilities= Total current liabilities= Long term debt= Common stock= Retained earnings external finds required = Total liabilities and stockholders equity=
using the judgemental approach the external finds requirement =

Provincial imports has assembled 2015 financial statement income and balance sheet and financial projections for use in preparing financial plans for the coming year 2016
2015 statement Sales revenue 4,996,000 Less costs of goods sold 2752,000 Gross profits 2,244,000 Less operating expense 850,000 Operating profits 1,394,000 Less interest expense 209,000 Net profits before taxes 1,185,000 Less tax ( rate 40%) 474,000 Net profits after tax 711,000 Less cash dividends 248,850 To retained earnings 462,150

Info related to financial projections for 2016 is 1: projected sales are 6,008,000 2: cost of goods sold in 2015 include 1,001,000 in fixed costs 3: operating expense in 2015 include 252,000 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 costing 351,000 will be purchased during the year. Total depreciation for the year will be 104,000 10: the tax rate will remain at 40%
Prepare a pro forma for year ended December 31 2016 using fixed cost data to improve the accuracy of the percent of sales method Sales Less cost of goods sold= Gross profits= Less operating expenses= Operating profits= Less interest expenses = Net profit before taxes = Less tax rate (40%)= Net profits after taxes = Less cash dividends (35%)= To retained earmings=
Prepare a pro forma balance sheet as of dec 31 2016 using info given and judgemental approach. Include a reconciliation of the retained earnings acct. NOTE taxes payable for 2016 are about 20.0422% of the 2015 taxes on the income statement . The pro forma value is obtained by taking 20.0422% of the 2016 taxes . Complete the assets of the pro forma balance sheet as of dec 31 2016 Cash= Marketable securities = Acct receivable = Inventories= Total current assets= Net fixed assets = Total assets=complete liabilities and equity part of pro forma balance sheet as of December 31 2016 ( judgemental method) Accounts payable = Taxes payable = Notes payable= Other current liabilities= Total current liabilities= Long term debt= Common stock= Retained earnings external finds required = Total liabilities and stockholders equity=
using the judgemental approach the external finds requirement =


2015 statement Sales revenue 4,996,000 Less costs of goods sold 2752,000 Gross profits 2,244,000 Less operating expense 850,000 Operating profits 1,394,000 Less interest expense 209,000 Net profits before taxes 1,185,000 Less tax ( rate 40%) 474,000 Net profits after tax 711,000 Less cash dividends 248,850 To retained earnings 462,150

Info related to financial projections for 2016 is 1: projected sales are 6,008,000 2: cost of goods sold in 2015 include 1,001,000 in fixed costs 3: operating expense in 2015 include 252,000 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 costing 351,000 will be purchased during the year. Total depreciation for the year will be 104,000 10: the tax rate will remain at 40%
Prepare a pro forma for year ended December 31 2016 using fixed cost data to improve the accuracy of the percent of sales method Sales Less cost of goods sold= Gross profits= Less operating expenses= Operating profits= Less interest expenses = Net profit before taxes = Less tax rate (40%)= Net profits after taxes = Less cash dividends (35%)= To retained earmings=
Prepare a pro forma balance sheet as of dec 31 2016 using info given and judgemental approach. Include a reconciliation of the retained earnings acct. NOTE taxes payable for 2016 are about 20.0422% of the 2015 taxes on the income statement . The pro forma value is obtained by taking 20.0422% of the 2016 taxes . Complete the assets of the pro forma balance sheet as of dec 31 2016 Cash= Marketable securities = Acct receivable = Inventories= Total current assets= Net fixed assets = Total assets=complete liabilities and equity part of pro forma balance sheet as of December 31 2016 ( judgemental method) Accounts payable = Taxes payable = Notes payable= Other current liabilities= Total current liabilities= Long term debt= Common stock= Retained earnings external finds required = Total liabilities and stockholders equity=
using the judgemental approach the external finds requirement = Info related to financial projections for 2016 is 1: projected sales are 6,008,000 2: cost of goods sold in 2015 include 1,001,000 in fixed costs 3: operating expense in 2015 include 252,000 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 costing 351,000 will be purchased during the year. Total depreciation for the year will be 104,000 10: the tax rate will remain at 40%
Prepare a pro forma for year ended December 31 2016 using fixed cost data to improve the accuracy of the percent of sales method Sales Less cost of goods sold= Gross profits= Less operating expenses= Operating profits= Less interest expenses = Net profit before taxes = Less tax rate (40%)= Net profits after taxes = Less cash dividends (35%)= To retained earmings=
Prepare a pro forma balance sheet as of dec 31 2016 using info given and judgemental approach. Include a reconciliation of the retained earnings acct. NOTE taxes payable for 2016 are about 20.0422% of the 2015 taxes on the income statement . The pro forma value is obtained by taking 20.0422% of the 2016 taxes . Complete the assets of the pro forma balance sheet as of dec 31 2016 Cash= Marketable securities = Acct receivable = Inventories= Total current assets= Net fixed assets = Total assets=complete liabilities and equity part of pro forma balance sheet as of December 31 2016 ( judgemental method) Accounts payable = Taxes payable = Notes payable= Other current liabilities= Total current liabilities= Long term debt= Common stock= Retained earnings external finds required = Total liabilities and stockholders equity=
using the judgemental approach the external finds requirement = Info related to financial projections for 2016 is 1: projected sales are 6,008,000 2: cost of goods sold in 2015 include 1,001,000 in fixed costs 3: operating expense in 2015 include 252,000 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 costing 351,000 will be purchased during the year. Total depreciation for the year will be 104,000 10: the tax rate will remain at 40%
Prepare a pro forma for year ended December 31 2016 using fixed cost data to improve the accuracy of the percent of sales method Sales Less cost of goods sold= Gross profits= Less operating expenses= Operating profits= Less interest expenses = Net profit before taxes = Less tax rate (40%)= Net profits after taxes = Less cash dividends (35%)= To retained earmings=
Prepare a pro forma balance sheet as of dec 31 2016 using info given and judgemental approach. Include a reconciliation of the retained earnings acct. NOTE taxes payable for 2016 are about 20.0422% of the 2015 taxes on the income statement . The pro forma value is obtained by taking 20.0422% of the 2016 taxes . Complete the assets of the pro forma balance sheet as of dec 31 2016 Cash= Marketable securities = Acct receivable = Inventories= Total current assets= Net fixed assets = Total assets=complete liabilities and equity part of pro forma balance sheet as of December 31 2016 ( judgemental method) Accounts payable = Taxes payable = Notes payable= Other current liabilities= Total current liabilities= Long term debt= Common stock= Retained earnings external finds required = Total liabilities and stockholders equity=
using the judgemental approach the external finds requirement =

Explanation / Answer

Answer:-

Prepare a pro forma income statement for the year ended December 31, 2016, using the fixed cost data given to improve the accuracy of the percent-of-sales method

Prepare a pro forma balance sheet as of dec 31 2016 using info given and judgemental approach

Provincial Imports, Inc. Income Statements 2015-Actual 2016-Proforma Sales 4,996,000 6,008,000 Less:-COGS Fixed cost 1,001,000 1,001,000 Varible(0.35 x sales) 1,751,000 2,105,686 gross profit 2,244,000 2,901,314 Less:-Operating Expenses Fixed expenses 252,000 252,000 variable expenses(0.12 x sales) 598,000 720,960 Operating profits 1,394,000 1,928,354 Less: Interest expense 209,000 209,000 Net income before taxes 1,185,000 1,719,354 Less: Taxes (rate = 40%) 474,000 687,742 Net income after taxes 711,000 1,031,612 Less: Cash dividends (35% of net profit after taxes) 248,850 361,064 Retained Earnings 462,150 670,548

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