Information from the financial statements of the Heir Jordan Corporation are shown below. Prepare the pro forma financial statements and calculate EFN, assuming a 15 percent increase in sales, no new external debt or equity financing, and a constant payout ratio. Sales Costs Cash Accounts receivable Inventory Net plant and equipment Accounts payable Notes payable Long-term debt Common stock Retained earnings Dividends Net income Increase in sales Tax rate $ $ $ $ $ LA GA $ $ 46,000 37,600 2,950 4,100 6,400 41,300 2,400 5,400 28,000 15,000 3,950 2,880 6,552 15% 21%

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
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Chapter1: Financial Statements And Business Decisions
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Information from the financial statements of the Heir Jordan Corporation are shown below.
Prepare the pro forma financial statements and calculate EFN, assuming a 15 percent increase
in sales, no new external debt or equity financing, and a constant payout ratio.
Sales
Costs
Cash
Accounts receivable
Inventory
Net plant and equipment
Accounts payable
Notes payable
Long-term debt
Common stock
Retained earnings
Dividends
Net income
Increase in sales
Tax rate
LA LA LA LA LA LA LA LA LA LA LA LA LA
$
$
$
$
$
$
$
$
$
46,000
37,600
2,950
4,100
6,400
41,300
2,400
5,400
28,000
15,000
3,950
2,880
6,552
15%
21%
Transcribed Image Text:Information from the financial statements of the Heir Jordan Corporation are shown below. Prepare the pro forma financial statements and calculate EFN, assuming a 15 percent increase in sales, no new external debt or equity financing, and a constant payout ratio. Sales Costs Cash Accounts receivable Inventory Net plant and equipment Accounts payable Notes payable Long-term debt Common stock Retained earnings Dividends Net income Increase in sales Tax rate LA LA LA LA LA LA LA LA LA LA LA LA LA $ $ $ $ $ $ $ $ $ 46,000 37,600 2,950 4,100 6,400 41,300 2,400 5,400 28,000 15,000 3,950 2,880 6,552 15% 21%
Pro forma income statement
Sales
Costs
Taxable income
Taxes
Net income
Dividends
Addition to retained earnings
Assets
Current assets
Cash
Accounts receivable
Inventory
Total
Fixed assets
Net plant and equipment
Balance Sheet
Liabilities and Owners' equity
Current liabilities
Accounts payable
Notes payable
Total
Long-term debt
Owners' equity
Common stock
Retained earnings
Total
Transcribed Image Text:Pro forma income statement Sales Costs Taxable income Taxes Net income Dividends Addition to retained earnings Assets Current assets Cash Accounts receivable Inventory Total Fixed assets Net plant and equipment Balance Sheet Liabilities and Owners' equity Current liabilities Accounts payable Notes payable Total Long-term debt Owners' equity Common stock Retained earnings Total
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