Question
Income Statement for December 31, 2019 Sales $4,000,000 Operating costs 3,200,000 EBIT $ 800,000 Interest 120,000 Pre-tax earnings $ 680,000 Taxes (25%) 170,000 Net income
Income Statement for December 31, 2019
Sales | $4,000,000 |
Operating costs | 3,200,000 |
EBIT | $ 800,000 |
Interest | 120,000 |
Pre-tax earnings | $ 680,000 |
Taxes (25%) | 170,000 |
Net income | 510,000 |
Dividends | $ 190,000 |
Balance Sheet as of December 31, 2019
Cash | $ 160,000 | Accounts payable | $ 360,000 | |
Receivables | 360,000 | Line of credit | 0 | |
Inventories | 720,000 | Accruals | 200,000 | |
Total CA | $1,240,000 | Total CL | $ 560,000 | |
Fixed assets | 4,000,000 | Long-term bonds | 1,000,000 | |
Total Assets | $5,240,000 | Common stock | 1,100,000 | |
RE | 2,580,000 | |||
Total L&E | $5,240,000 |
Suppose that in 2020 sales increase to $4.2 million and that 2020 dividends will increase to $110,000. Forecast the financial statements using the forecasted financial statement method. Assume the firm operated at full capacity in 2019. The long-term bonds have an interest rate of 8%. New financing will be with a line of credit. Assume it will be added at the end of the year. Cash does not earn any interest income. Enter your answers as positive values. Do not round intermediate calculations. Round your answers to the nearest dollar.
Q:
Garlington Technologies Inc. Pro Forma Balance Statement December 31, 2020 | |||
Cash | $ | ||
Receivables | $ | ||
Inventories | $ | ||
Total current assets | $ | ||
Fixed assets | $ | ||
Total assets | $ | ||
Accounts payable | $ | ||
Line of credit | $ | ||
Accruals | $ | ||
Total current liabilities | $ | ||
LT bonds | $ | ||
Common stock | $ | ||
Retained earnings | $ | ||
Total L&E | $ |
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