Input the assumptions in the grey highlighted cells and then reference those cells when projecting the appropriate income statement, balance sheet, or break-even account.

. Project 2020 2022 Income Statement and Balance Sheet. Assumptions: Sales growth rates in each of next 3 years: 20%, 25%, 30% Operating expenses/sales percentage stay at 2019 level Cost of goods sold stays at 2019 level for 2020 and them improves by .05 in 2021 and by another .02 in 2022 40% tax rate No dividends or new stock issued Interest expense fixed at $400 / year Bank loan and LT debt stay constant 2020 A/R days = year 2019 days, then decrease by 3 days in 2021 & another 3 days in 2022 2020 Inventory days = year 2019 days then decrease by 3 days in 2021 & 2 days 2022 A/P days stays at year 2019 days Net fixed assets and accruals keep relationship with sales Required cash fixed at 1000 Calculate Additional Funds Needed as plug (to get Balance Sheet to balance!) . . Calculate 2020 breakeven revenues and units. Assumptions: All operating expenses (excluding interest) are fixed Average price per unit is $50 B D E F Assumptions (use these to drive projected IS and BS) 0.2 0.25 0.3 Actual 2019 15000 >>>>>>>>>>>> 2020 2021 2022 18000 22500 29250 10500 4500 -2500 -400 1600 -640 960 0 960 A 1 2 Sales Growth % of Current Sales 3 Average price per item 4 Cost of Goods Sold % of Sales 5 Operating Expense % of Forecast Sales 6 Tax Rate % of EBT 7 Dividend Rate % of NI 8 Required Cash % of Forecast Sales 9 A/R days 10 Inventory Days 11 Net Fixed Assets % of Forecast Sales 12 Days Payable 13 Accrued Liability % of Forecast Sales 14 15 16 17 Net Sales 18 Cost of Goods Sold 19 Gross Profit 20 Operating exp 21 Interest 22 EBT 23 Taxes (40%) 24 Net Income 25 26 Cash Dividends (0% of NI) 27 Added Retained Earnings 28 29 Balance Sheet 30 Required Cash 31 A/R 32 Inventories 33 Total Current Assets 34 Net Fixed Assets 35 Total Assets 36 37 Accounts Payable 38 Bank Loan 39 Accured Liability 40 Total Current Liability 41 Long Term Debt 42 Common Stock 43 Retained Earnings 44 Additional Funds Needed (AFN) 45 Total Liability & Equity 46 47 BREAKEVEN CALCULATION 48 Fixed Costs 49 Gross margin 50 BREAKEVEN REVENUES 51 Price per unit 52 Cost per unit 53 Contribution per unit 54 BREAKEVEN UNITS 55 1000 2000 2200 5200 6800 12000 1600 1800 1200 4600 2200 2400 2800 0 12000