Question
The following data is from the Tawny Group pro-forma budget assumptions for the year ended June 30, 2020 and is to be used to develop
The following data is from the Tawny Group pro-forma budget assumptions for the year ended June 30, 2020 and is to be used to develop their pro-forma financial statements. The firm produces various forms of carbonated juices for several small independent beverage companies. Revenues are forecast to be $50,000,000 for the next fiscal year. The effective tax rate is 20%. You have been asked to create a Balance Sheet and a Statement of Income and Retained Earnings using the following: Capital Assets (net)............................................ ................ 5 times Accounts Receivable Selling and general expenses............................................ ............... 25% of Revenues Retained Earnings Opening............................................ ........................ $18,200,000 Total Equity % of Total Assets............................................. ..................................... 45% Current Ratio................................................ ....................................... 2:1 Amortization.............................................. ........ 10% of Capital Assets Inventory days on hand............................................ ............................. 180 days Average collection period............................................. ............................... 72 days Gross Profit Margin................................................... ..................................... 48% Share Capital ................................................................................. 40% of Shareholder Equity Total Assets................................................................................... ............. 1.5 times Revenue Retained Earnings Ending.............................................................. .............. To Be Determined Share Capital.............................................. .............. To be Determined Long-term Debt 5%. ............................................. Cash.............................................. .............. To Be Determined Dividends.. . To Be Determined Assume a 360 day year Prepare your Balance Sheet and Statement of Income and Retained Earnings based on the information provided above.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started