Using the income statement from Folder Factory Financials Folder Factory Financials , prepare a pro forma...

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Finance

Using the income statement from Folder Factory Financials FolderFactory Financials , prepare a pro forma income statement for 2016if the company projects sales to be $60,000 in 2016.
Balance Sheet
Folder Factory, Inc.
December 31, 2014 and 2015
2015
2014
Assets
Cash
$ 1,000
$     500
Accounts receivable
5,000
4,500
Inventory
7,000
6,000
Total current assets
$13,000
$11,000
Gross fixed assets
$20,000
$15,000
Less: Accumulated depreciation
10,000
    9,000
Net fixed assets
$10,000
$ 6,000
Total assets
$23,000
$17,000
Liabilities and stockholders’ equity
Accounts payable
$ 2,000
$ 1,500
Notes payable
3,000
2,500
Accruals
500
500
Long-term debt
10,000
6,000
Common stock at par ($1 par)
500
500
Paid-in capital in excess of par
5,500
5,500
Retained earnings
    1,500
       500
Total liabilities and stockholders’ equity
$23,000
$17,000
Income Statement
Folder Factory, Inc.
for the Year Ended December 31, 2015
Sales
$40,000
Cost of goods sold
21,000
Gross profits
$19,000
Operating expenses
13,000
Operating profits
$ 6,000
Interest expense
    2,000
Net profits before taxes
$ 4,000
Taxes (40%)
    1,600
Net profits after taxes
$ 2,400

Other information (2015):
DepreciationExpense                        $1000
Tax rate 40%
Operating Profits = Earnings before interest and taxes

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Income StatementFolder Factory Incfor the Year Ended December 3120152016Sales4000060000Cost of See Answer

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Transcribed Image Text

Using the income statement from Folder Factory Financials FolderFactory Financials , prepare a pro forma income statement for 2016if the company projects sales to be $60,000 in 2016.Balance SheetFolder Factory, Inc.December 31, 2014 and 201520152014AssetsCash$ 1,000$ 500Accounts receivable5,0004,500Inventory7,0006,000Total current assets$13,000$11,000Gross fixed assets$20,000$15,000Less: Accumulated depreciation10,000 9,000Net fixed assets$10,000$ 6,000Total assets$23,000$17,000Liabilities and stockholders’ equityAccounts payable$ 2,000$ 1,500Notes payable3,0002,500Accruals500500Long-term debt10,0006,000Common stock at par ($1 par)500500Paid-in capital in excess of par5,5005,500Retained earnings 1,500 500Total liabilities and stockholders’ equity$23,000$17,000Income StatementFolder Factory, Inc.for the Year Ended December 31, 2015Sales$40,000Cost of goods sold21,000Gross profits$19,000Operating expenses13,000Operating profits$ 6,000Interest expense 2,000Net profits before taxes$ 4,000Taxes (40%) 1,600Net profits after taxes$ 2,400Other information (2015):DepreciationExpense $1000Tax rate 40%Operating Profits = Earnings before interest and taxes

Balance Sheet Folder Factory, Inc. December 31, 2014 and 2015
		2015		2014
Assets
Cash		$ 1,000		$ 500
Accounts receivable		5,000		4,500
Inventory		7,000		6,000
Total current assets		$13,000		$11,000
Gross fixed assets	$20,000		$15,000
Less: Accumulated depreciation	10,000		9,000
Net fixed assets		$10,000		$ 6,000
Total assets		$23,000		$17,000
Liabilities and stockholders’ equity
Accounts payable		$ 2,000		$ 1,500
Notes payable		3,000		2,500
Accruals		500		500
Long-term debt		10,000		6,000
Common stock at par ($1 par)		500		500
Paid-in capital in excess of par		5,500		5,500
Retained earnings		1,500		500
Total liabilities and stockholders’ equity		$23,000		$17,000

Income Statement Folder Factory, Inc. for the Year Ended December 31, 2015
Sales	$40,000
Cost of goods sold	21,000
Gross profits	$19,000
Operating expenses	13,000
Operating profits	$ 6,000
Interest expense	2,000
Net profits before taxes	$ 4,000
Taxes (40%)	1,600
Net profits after taxes	$ 2,400