QUESTION 2 (25 Marks) 2.1 REQUIRED Use the information given below to prepare the following: 2.1.1 Projected Statement of Comprehensive Income for the year ended 31 October 2019. (8 marks) 2.1.2 Projected Statement of Financial Position as at 31 October 2019. (12 marks) INFORMATION Pulsar Ltd, a manufacturing concern, is making financial plans for one of its projects for the 12 months commencing 01 November 2018. The estimates of the operating results and financial position for the current year are shown in the statements below: Projected Statement of Comprehensive Income for the year ended 31 October 2018 R Sales 1 837 500 Cost of sales (1 176 000) Gross profit 661 500 Operating expenses (296 500) Selling expenses 100 000 Depreciation 86 250 Other general and administrative expenses 110 250 Operating profit 365 000 Interest expense (45000) Profit before tax 320 000 Income tax (96 000) Profit after tax 224 000 ASSETS Non-current assets Fixed/Tangible assets Current assets Inventories Trade and other receivables Cash and cash equivalents Total assets 1 100 000 1 100 000 950 000 650 000 250 000 50 000 2 050 000 EQUITY AND LIABILITIES Shareholders' equity Ordinary share capital Retained earnings Non-current liabilities Long-term loan Current liabilities Trade and other payables Total equity and liabilities 720 000 400 000 320 000 350 000 350 000 980 000 980 000 2 050 000 : Assumptions for the financial year ending 31 October 2019: Projected sales are R2 500 000 as compared to the estimated R1 837 500 for the financial year ended 31 October 2018 The gross margin percentage for the year ended 31 October 2019 is expected to be the same as for the year ended 31 October 2018. Selling expenses are expected to rise by 40%. Other general and administrative expenses for the year ended 31 October 2019 should be the same percentage of sales as for the preceding financial year. Interest expense is estimated to be 3% of sales. Income taxes are estimated at 30% of pre-tax profits. New equipment costing R300 000 will be purchased during October 2019. Depreciation for the year ended 31 October 2019 is expected to total R110 000. The business maintains a cash balance of R50 000. Inventory usually represents 30% of sales. Trade and other receivables are expected to represent 20% of sales. Trade and other payables are budgeted at 10% of sales. 50 000 ordinary shares are expected to be issued at R3 each during January 2019. Dividends of R120 000 are expected to paid to the shareholders. The long-term loan balance is expected to be reduced by R50 000 during the financial year ended 31 October 2019 The amount of long-term debt required must be calculated