Table 4.8 $3,028,500 1,350,000 1,260,600 $ 417,900 Income Statement Wirl Wind Company Sales revenue Less: Cost of goods sold Fixed costs Variable costs Gross profits Less: Operating expenses Fixed expenses Variable expenses Operating profits Less: Interest expense Net profits before taxes Less: Taxes (40%) Net profits after taxes Less: Dividend Increased retained earnings 4,500 85,840 $ 327,560 82,150 $ 245,410 98,164 $ 147,246 50,000 $ 97,246 $ 625,000 298,000 580,000 496,000 $1,999,000 Balance Sheet Wirl Wind Company Assets Current assets Cash Marketable securities Accounts receivable Inventories Total current assets Land and building $625,000 Machinery & equip 765,000 Fixtures & Furn 110,000 Total gross fixed assets Less: Accumulated Depreciation Net fixed assets Total assets Liabilities and Stockholders' Equity Current liabilities Accounts payable Notes payable Accruals Total current liabilities Total Long-term debt Total liabilities Stockholders' equity Preferred stock Common stock Paid-in-capital Retained earnings Total stockholders' equity Total liabilities and stockholders equity $1,500,000 30,000 $1,470,000 $3,469,000 $ 267,000 135,000 288,000 $ 690,000 1,200,000 $1,890,000 79,000 750,000 601,000 149,000 $1,579,000 $3,469,000 The Wirl-Wind Company of America is trying to plan for the next year. Using the current income statement and balance sheet given in Table 4.8, and the additional information provided, prepare the company's pro forma statements. Sales are projected to increase by 15 percent. Total of $75,000 in dividend will be paid. A minimum cash balance of $650,000 is desired. A new asset for $50,000 will be purchased. Depreciation expense for next year is $50,000. Marketable securities will remain the same. Accounts receivable, inventory, accounts payable, notes payable, and accruals will increase by 15 percent. $30,000 new issue of bond will be sold. No new stock will be issued