Case: 35 Financial Analysis and Forecasting TABLE 2 Historical and Pro Forma Income Statements for Years Ended December 31 (Thousands of Dollars) Pro Forma 1990 1991 1992 1993 1994 Net sales $170,998 $184,658 $195,732 X X Cost of goods sold 187,684 151.761 166.837 X Gross profit $ 33,314 $ 32,897 3 28,895 537,678 549 520 Administration and selling expenses $ 12,790 $ 15,345 5 16,881 $17,224 X Depreciation 1.594 1,658 2,040 2.423 1,823 Miscellaneous expenses 2.027 3.557 5,725 3.768 X Total operating expenses $ 16,411 3 20,560 5 24,646 X X EBIT $ 16,903 $ 12,337 $ 4,249 $14,263 X Interest on short-term loans $ 319 $ 561 5 1,823 $ 2,953 5 2,953 Interest on long-term loans 638 956 956 X 956 Interest on mortgage 258 234 211 170 Total interest $ 1,215 3 1,751 $ 2,990 5 4,098 5 4,079 Before-tax earnings $ 15,688 $ 10.586 5 1,259 X 521,953 Taxes 6.275 4.234 504 4.066 8, 781 Net income $ 9.413 $ 6.352 753 X X Dividends on stock 2,353 1,588 189 X Additions to retained earnings $ 7,060 $ 4,764 3 567 X X