COGS- Beginr & Purchase - End Gross proft - Total sales Tolol COGS Beginve- pure Income Statement Student Copy (in thousands) 2017 2018E Assumptions $4,519 10 5,000 peso Sales Cost of Goods Sold Beg Inventory Purchases Ending Inventory Total COGS 432 5 33 3,579 587 $3.4242 3460 79: begin 578376) Pure 1212 10 90 272 CO3 1.095 1940 $ 155 Gross Profit S . Operating Expenses EBIT Interest Expense Taxes NI CBT - Taxis 56 $99 22 S77 $57.75 *Use 25% as the tax rate, and 5% as the interest rate 2017 2018E 30 M 1.2 Balance Sheet of Student Copy 2,35 Cash AR Inventory PPE (2017: Saleto) sales is Total Assets $ 56 606 587 288 MOV 753 753 8.12.65 14 19. $1537 $ 300 Early Bank Debt N0739_PLUG .. Notes Payable trade AP cost of 108 so day Purchases & 10 Accrued Expenses LTD Current Portion 100- LTD 30 165 2/10/50 SE Equity 449 TL & SE Equity SE Equity N1 o Doidend = Next year 7347500 regler Please use the percentage of sales method and the ratio method (where appropriate) to forecast 2018E financial statements using the 2017 data. Use formulas to do all calculations of the forecast estimates and use the iteration formula to determine the interest expense and amount of debt at the same time. All assumptions should be included. At the beginning of 2017, Student Copy anticipated a substantial increase in sales. Despite good sales the company experienced a shortage of cash and found it needed to increase its short term borrowing to at least 500.000 To do this it had to change banks as its current line of credit was $300.000. The new line of credit required that it pay off all of its notes payables also and to maintain is accounts payables at 10 days outstanding. This way it would be able to take all of its purchase discounts which are 2/10 net 30. There will be additions to property, plant and equipment as there is a need for capacity to increase to support this increase in sales. In addition, the company is trying to keep its days sales outstanding (DSO) ratio at 30 days. Sales are predicted to increase from $4,519,000 to $5,000,000. Use the percentage of sales method and ratio method to develop a pro forma balance sheet and an income statements for 2018 to determine the amount of BANK DEBT required to support this sales increase. 1o AR sules per day 10 dag - Porchase 27 decond cost of Missing Disoont- 36 - so day to day- zo das curring interst experie 360 day /rodz 18 poiod. ods Do you know how to calculate 2018 by using percentage?? It should get these amounts but I do not know how the teacher did it