ProForma Statement Petitco Manufacturing Case Background John Small, director of Petit Co Manufacturing, is working as part of a strategic planning group tasked with laying out the future direction of the company. Mr. Small has compiled some information about the company from which he would like to come up with future estimates and trends. Information From the sales department, Mr. Small found the following sales and price information. The price has steadily decreased by 6% over the last five years. 310 721 932 1065 1108 Priten $1,000.00 $940.00 $8.83.60 $830.58 $780.75 From accounting and production Mr. Small received the following cost and expense information. He was also informed that the average taxes were 29% Sellin Exo Depreciation Interest $148,800.00 $55,023.00 $52,310.86 $24,000.00 $15,000.00 $393,089.20 $109.456.00 $78,345.32 $38,000.00 $14,569.00 $461,168.51 $137,998.00 $80,004.23 $32,000.00 $14,034.00 $482,285.98 $138,032.78 $82.041.56 $26,000.00 $13,456.00 $475,233.53 $148,023.45 $78.997.49 $20,000.00 $12,954.00 ProForma Mr. Small received information on depreciation and interest expenses for the ensuing 5 years. Depreciation $18,000.00 $17,000.00 $16,000.00 $16,000.00 $16,000.00 Interest $12,532.00 $11,980.00 $11,611.00 $11,178.00 $10,792.00 The estimations included in the proforma statements are critical for the company since many direct investment decisions must be made to meet anticipated sales growth. The IS generated will become the backbone of the financing decisions and cash flow planning for management. Task: 1) Compile the Income Statement and forecast out the next five years (6-10) based upon the information provided above. 2) Does the future look bright for Mr. Small and PetitCo? Why or why not? (150 words minimum/250 words maximum) ProForma Statement Petitco Manufacturing Case Background John Small, director of Petit Co Manufacturing, is working as part of a strategic planning group tasked with laying out the future direction of the company. Mr. Small has compiled some information about the company from which he would like to come up with future estimates and trends. Information From the sales department, Mr. Small found the following sales and price information. The price has steadily decreased by 6% over the last five years. 310 721 932 1065 1108 Priten $1,000.00 $940.00 $8.83.60 $830.58 $780.75 From accounting and production Mr. Small received the following cost and expense information. He was also informed that the average taxes were 29% Sellin Exo Depreciation Interest $148,800.00 $55,023.00 $52,310.86 $24,000.00 $15,000.00 $393,089.20 $109.456.00 $78,345.32 $38,000.00 $14,569.00 $461,168.51 $137,998.00 $80,004.23 $32,000.00 $14,034.00 $482,285.98 $138,032.78 $82.041.56 $26,000.00 $13,456.00 $475,233.53 $148,023.45 $78.997.49 $20,000.00 $12,954.00 ProForma Mr. Small received information on depreciation and interest expenses for the ensuing 5 years. Depreciation $18,000.00 $17,000.00 $16,000.00 $16,000.00 $16,000.00 Interest $12,532.00 $11,980.00 $11,611.00 $11,178.00 $10,792.00 The estimations included in the proforma statements are critical for the company since many direct investment decisions must be made to meet anticipated sales growth. The IS generated will become the backbone of the financing decisions and cash flow planning for management. Task: 1) Compile the Income Statement and forecast out the next five years (6-10) based upon the information provided above. 2) Does the future look bright for Mr. Small and PetitCo? Why or why not? (150 words minimum/250 words maximum)
