Sales $165,000 Cost of goods sold 115,500 Gross profit 49,500 Operating expenses 138,000 Depreciation expense 131,250 Income before interest & taxes (219,750) Interest expense 25,000 Income before taxes (244,750) Income tax (expense)/recovery |122,375 Net Income $(122,375) PRO FORMA Quarterly Balance Sheets Q1 Q2 Cash $815,500 Accounts receivable 1 10,000 Inventory 947,000 Plant & equipment 10,500,000 Accumulated depreciation (4,031,250) Total Assets $8,341,250 Accounts payable $125,000 Line of credit 0 Interest payable 25,000 Taxes payable (122,375) Current portion of LT debt 200,000