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INSTRUCTIONS: Using the 2016 trial balance and additional information below, prepare the projected (2017) financial statements for Walnut Grove. The prior year data (provided) is
INSTRUCTIONS: Using the 2016 trial balance and additional information below, prepare the projected (2017) financial statements for Walnut Grove. The prior year data (provided) is the starting point for your projections, and then each of the assumptions listed below will also be used Prepare an Excel workbook which contains the following information: . Tab 1: 2016 Trial Balance (provided in this document) . Tab 2: 2017 Projected Income Statement . Tab 3: 2017 Projected Balance Sheet . Tab 4: 2017 Projected Statement of Cash Flows Assumptions: 1. Sales will change as follows a. Material & Supplies Sales will increase 4% b. Small Tool Sales will increase 3% Tool Rental Revenue will continue throughout the 2017 year. An average of 20 tools will be rented each week, at an average of $100 per week. c. 2. Vendor compensation will increase consistently with Material & Supplies Sales and Small Tools Sales. Cost of sales for materials and supplies and small tools will increase proportionately based on their current percentage of sales, respectively. (HINT: You will need to use vertical analysis.) Small tools, including blades and other items, will be expected, and are expected to total $7,500 in 2017 Office supplies and postage are expected to increase by 50% during 2017 3. 4. 5. 6. On February 1st, the company will invest $175,000 in new equipment for its custom cabinet division. This equipment will have a 5-year life and should be depreciated using the straight-line method. This purchase represents the only expected change to property, plant, and equipment. The company will finance the equipment purchase with a 5 year note at 2.5% interest
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