Income Statement

Revenues

Liabilities

Accounts Payable

Long$-$Term Debt

$$3,266,000$

Manufacturing Costs

Shipping Costs

Customer Acquisition Costs

EBT

Taxes $(21\%)$

Net Income

Balance Sheet

Assets

Current Assets

Long$-$Term Assets

Total Assets

Common Stock

Accumulated Retained Earnings

Total Liabilities and EquityThe ComfyLinks to an external site.$$is a product dreamed by the Speciale brothers, Michael and Brian. The Speciale Brothers hit the jackpot on Shark Tank and agreed to sell a $30\%$ stake in their business for $$50,000$ on Dec $31,2020.$ The first year went amazing! The company went from just a few protypes they made to over $$15$ million in sales. The company$$s first year results are given below.$$ Note, like the real world, there is more information than you actually need to do this assignment.$$ You need to figure out what to use.

They have a negotiated contract with a manufacturer in Bangladesh for the following orders:$$

Production Costs

Monthly Production Bill with under $20,000$ order $$13/$Comfy

Monthly Production Bill with under $20,001-99,999$ order $$12/$Comfy

Monthly Production Bill with $100,000+$ order $$11/$ComfyShipping costs are $$4$ per Comfy $($either to the customer directly or to the store$/$QVC$).$

Additionally, the brothers have rolled out an advertising platform and website:$$thecomfy$.$comLinks to an external site.. Customer acquisition costs $($the cost of accepting credit cards and advertising on Facebook$)$ are approximately $$6$ per comfy and occur the same month as the sale, regardless of the venue sold.

Creating a Comfy Proforma

Using the percentage of sales approach and the company$$s expectations of sales in the chart below, create a proforma income statement and balance sheet. Determine any additional funding needed in order to sustain the projected growth rate. The Shark wants her $30\%$ of profits in the form of a cash dividend paid out. The Speciale brothers have promised to re$-$invest their money into the business for the first three years.

Product Sale Forecast:

Online Home Shopping Network Bed Bath and Beyond

YR $1$: $75,000300,000200,000$

YR $2$: $100,000400,000250,000$

YR $3$: $150,000600,000375,000$

Current Assets, Long$-$term assets, and account payable are $25\%,50\%,$ and $20\%$ of sales, respectively. Long$-$term debt and equity are not fixed in relation to sales.

Using the template and the information above, create a pro forma for The Comfy.