Use the data provided and the budgets prepared from JKL Corporation in Assignments 6.1 and 6.2 to help develop the following projected financial statements:

1- Pro forma statement of condition as of June 30, 20xx. (10 points)

2- Proforma income and expense statement for the quarter ended June 30, 20xx.

3- Pro-forma statement of cash flows for the quarter ended June 30, 20xx.

Then, complete the following table of financial analysis rates. It shows the calculation to obtain each rate.

DATA AND RESULTS:

A. Certain data of the Statement of position (Balance Sheet) as of March 31, 20xx: Dr Cr Cash $20,000 (DR) Accounts receivable $64,000 (DR) Inventory $15,400 (DR) Buildings and equipment (net of depreciation) $225,000 (DR) Accounts payable $23,400 (CR) Long-term debts $90,000 (CR) Common shares- principal $150,000 (CR) Retained Earnings $61,000 (CR) Totals $324,400 (DR) $324,400 (CR) B. The projected and actual sales for various months of 20xx are: March (reals) $80,000 April $83.400 May $69,500 June $82,900 July $64,600

1- Monthly sales are 20% cash and 80% credit. Credit sales from the previous month are collected in full in the following month (therefore, what is in accounts receivable at the end of March is 80% of March sales). 2- The gross profit margin generated by the corporation on its sales is 38%. 3- Each month's ending inventory is equal to 25% of the next month's budgeted cost of sales. 4- 40% of monthly merchandise purchases are paid in the month of purchase and the remainder in the month following the purchase. 5- Expected monthly expenses are: salaries, $10,200; advertising, $6,300 per month; and remaining expenses (except depreciation) represent 8% of sales. Assume that these expenses are paid every month (nothing is due at the end of the month). 6- Depreciation expense is $10,000 for the quarter and includes the portion that corresponds to assets acquired during the period. 7- Equipment was purchased in cash: $25,200 in April and $19,100 in May 20xx. 8- Management wants to maintain a minimum cash balance at the end of each month of $8,000. 9- When the company has a need for cash, it can borrow from a local bank in $1,000 increments at the beginning of each month up to a borrowing ceiling of $20,000. The interest rate the bank charges on these loans is 1% per month and the interest is paid the next month (we presume that it is not compound interest and that each loan is made at the end of the month). The company paid dividends of $5,200 in June.

Ratios 1. current ratio 2. Acid-test ratio 3. accounts receivable turn-over 4. average collection period 5. inventory turn-over 6. average sales period) 7. debt/assets 8. debt-equity ratio 9. times interest earned ratio 10. gross margin percentage 11. Net margin 12. (ROI: return on investment) June 20xx Calculation Sales Cash Sales (1) Credit Sales Collection from Accounts Receivable (ii) Total Collection from Sales (i)+(ii) Sales Cost of Sales (Salesx62%) Add:Ending Inventory Total Needed Schedule of Sales Collection April May Less:Beginning Inventory Budgeted purchases $83,400 $16,680 $66,720 $64,000 $80,680 Purchase Budget April $69,500 May June $13,900 $82,900 $235,800 $47,160 $55,600 $66,320 $188,640 $66,720 $55,600 $186,320 Total $16,580 $80,620 $72,180 $233,480 Total $83,400.00 $69,500.00 $82,900.00 $235,800.00 $51,708.00 $43,090.00 $51,398.00 $146,196.00 $10,772.50 $12,849.50 $10,013.00 $10,013.00 $62,480.50 $55,939.50 $61,411.00 $156,209.00 $15,400.00 $10,772.50 $12,849.50 $15,400.00 $47,080.50 $45,167.00 $48,561.50 $140,809.00 June Budgeted purchases Cash Purchase (40%) (1) Accounts Payable Paid (ii) Total Disbursment (i)+(ii) Salaries Schedule of Purchase disbursements April May Total $47,080.50 $45,167.00 $48,561.50 $140,809.00 $18,832.20 $18,066.80 $19,424.60 $56,323.60 $23,400.00 $28,248.30 $27,100.20 $78,748.50 $42,232.20 $46,315.10 $46,524.80 $135,072.10 Advertising Other Expenses Total Selling and administrative Paid June Selling and administrative expense disbursements for the quarter April May June $10,200 $6,300 $6,672 $23,172 Total $10,200 $10,200 $30,600 $6,300 $6,300 $18,900 $5,560 $6,632 $18,864 $22,060 $23,132 $68,364 Formula Cash Budget A Beginning Cash Balance D 1 B C=A+B D E F G H Add Cash receipts Total Cash on Hand Less Disbursements Purchases Selling & distributions Selling & Administration expenses Purchase of Equipment Dividends I J-Sum(D:1) Total Disbursements K=C-J Excess (Deficiency) Fianancing L Loan M Loan Repayments N Interest O=L+M+N Total Financing P=K+0 Cash Closing Balance May June Quarter April $ 20,000.00 $10,075.80 $ 8,220.70 $ 20,000.00 $ 80,680.00 $80,620.00 $72,180.00 $2,33,480.00 Taken from Sales collection schedule given in problem $1,00,680.00 $90,695.80 $80,400.70 $2,53,480.00 $ 42,232.20 $46,315.10 $46,524.80 $1,35,072.10 Taken from Schedule of Purchase Disbursements Given in Problem $ 23,172.00 $22,060.00 $23,132.00 $ 68,364.00 Taken from Selling & Admnistration Schedule given from problem $ 25,200.00 $19,100.00 $ $ 44,300.00 Given in problem $5,200.00 $ 5,200.00 Given in problem $ 90,604.20 $87,475.10 $74,856.80 $2,52,936.10 543.90 10,075.80 $3,220.70 $ 5,543.90 $ $ Sheet1 Sheet2 mady Accessibility: Investigate $ $ $ Working Note:1 for Computation of Loan Amount Desired Ending Cash Add Deficit or less excess cash Less Interest to be paid Total Loan Amount to be borrowed Loan Amount in 1000's Sheet3 Sheet4 $ $ 10,075.80 (+) July $5,000.00 $3,000.00 $ 8,000.00 Working Note 1 $ S -50.00 $ $ 5,000.00 $ 2,950.00 $ $8,220.70 $ 8,493.90 $ $ 8,000.00 $ 8,000.00 $-3,220.70 $-5,543.90 $ -50.00 (5000*1%) $ $ 4,779.30 $2,406.10. $5,000.00 $3,000.00 -50.00 Working Note 1 7,950.00 8,493.90 + 4 d Ratios 1. current ratio 2. Acid-test ratio 3. accounts receivable turn-over 4. average collection period 5. inventory turn-over 6. average sales period) 7. debt/assets 8. debt-equity ratio 9. times interest earned ratio 10. gross margin percentage 11. Net margin 12. (ROI: return on investment) June 20xx Calculation Sales Cash Sales (1) Credit Sales Collection from Accounts Receivable (ii) Total Collection from Sales (i)+(ii) Sales Cost of Sales (Salesx62%) Add:Ending Inventory Total Needed Schedule of Sales Collection April May Less:Beginning Inventory Budgeted purchases $83,400 $16,680 $66,720 $64,000 $80,680 Purchase Budget April $69,500 May June $13,900 $82,900 $235,800 $47,160 $55,600 $66,320 $188,640 $66,720 $55,600 $186,320 Total $16,580 $80,620 $72,180 $233,480 Total $83,400.00 $69,500.00 $82,900.00 $235,800.00 $51,708.00 $43,090.00 $51,398.00 $146,196.00 $10,772.50 $12,849.50 $10,013.00 $10,013.00 $62,480.50 $55,939.50 $61,411.00 $156,209.00 $15,400.00 $10,772.50 $12,849.50 $15,400.00 $47,080.50 $45,167.00 $48,561.50 $140,809.00 June Budgeted purchases Cash Purchase (40%) (1) Accounts Payable Paid (ii) Total Disbursment (i)+(ii) Salaries Schedule of Purchase disbursements April May Total $47,080.50 $45,167.00 $48,561.50 $140,809.00 $18,832.20 $18,066.80 $19,424.60 $56,323.60 $23,400.00 $28,248.30 $27,100.20 $78,748.50 $42,232.20 $46,315.10 $46,524.80 $135,072.10 Advertising Other Expenses Total Selling and administrative Paid June Selling and administrative expense disbursements for the quarter April May June $10,200 $6,300 $6,672 $23,172 Total $10,200 $10,200 $30,600 $6,300 $6,300 $18,900 $5,560 $6,632 $18,864 $22,060 $23,132 $68,364 Formula Cash Budget A Beginning Cash Balance D 1 B C=A+B D E F G H Add Cash receipts Total Cash on Hand Less Disbursements Purchases Selling & distributions Selling & Administration expenses Purchase of Equipment Dividends I J-Sum(D:1) Total Disbursements K=C-J Excess (Deficiency) Fianancing L Loan M Loan Repayments N Interest O=L+M+N Total Financing P=K+0 Cash Closing Balance May June Quarter April $ 20,000.00 $10,075.80 $ 8,220.70 $ 20,000.00 $ 80,680.00 $80,620.00 $72,180.00 $2,33,480.00 Taken from Sales collection schedule given in problem $1,00,680.00 $90,695.80 $80,400.70 $2,53,480.00 $ 42,232.20 $46,315.10 $46,524.80 $1,35,072.10 Taken from Schedule of Purchase Disbursements Given in Problem $ 23,172.00 $22,060.00 $23,132.00 $ 68,364.00 Taken from Selling & Admnistration Schedule given from problem $ 25,200.00 $19,100.00 $ $ 44,300.00 Given in problem $5,200.00 $ 5,200.00 Given in problem $ 90,604.20 $87,475.10 $74,856.80 $2,52,936.10 543.90 10,075.80 $3,220.70 $ 5,543.90 $ $ Sheet1 Sheet2 mady Accessibility: Investigate $ $ $ Working Note:1 for Computation of Loan Amount Desired Ending Cash Add Deficit or less excess cash Less Interest to be paid Total Loan Amount to be borrowed Loan Amount in 1000's Sheet3 Sheet4 $ $ 10,075.80 (+) July $5,000.00 $3,000.00 $ 8,000.00 Working Note 1 $ S -50.00 $ $ 5,000.00 $ 2,950.00 $ $8,220.70 $ 8,493.90 $ $ 8,000.00 $ 8,000.00 $-3,220.70 $-5,543.90 $ -50.00 (5000*1%) $ $ 4,779.30 $2,406.10. $5,000.00 $3,000.00 -50.00 Working Note 1 7,950.00 8,493.90 + 4 d