Please see information attached to answer below questions. Preferrably in Excel. a1. Produce an income statement for 2020. Assume that net working capital will equal 50% of fixed assets.a2. Produce a balance sheet for 2020. Assume that net working capital will equal 50% of fixed assets.b. Now assume that the balancing item is debt and that no equity is to be issued. Prepare a completed pro forma balance sheet for 2020.c. Assume that the balancing item is debt and that no equity is to be issued, what is the projected debt ratio for 2020? The following tables contain financial statements for Dynastatics Corporation.Although the company has not been growing, it now plans to expand and willincrease net fixed assets (i.e., assets net of depreciation) by $200,000 per year forthe next 4 years, and it forecasts that the ratio of revenues to total assets willremain at 1.50. Annual depreciation is 20% of net fixed assets at the beginning ofthe year. Fixed costs are expected to remain at $94 and variable costs at 70% ofrevenue. The company's policy is to pay out one-half of net income as dividendsand to maintain a book debtratio of 20% of total capital.INCOME STATEMENT 2019 (figures in thousands)Revenue1,800Fixed costs94Variable Cost (70%) of revenue)1,260Depreciation$160Interest (6% of beginning of year debt)Taxable Income18268Taxes (at 35%)$$94Net Income174Dividends$87Addition to retained earnings$87INCOME STATEMENT 2019 (figures in thousands)AssestsNet Working CapitalFixed Assets4002$800Total Assets1.200Liabilities and Shareholders equityDebt300EquityTotal liabilities and shareholders equity2$9001,200

The question is related to Balance Sheet and Income Statement for the year ended 2020. The details are given. We will first calculate the net fixed Assets and then sales. Since you have posted a question with multiple sub-parts, we will solve first three sub parts for you. To get remaining sub-part solved please repost the complete question and mention the sub-parts to be solved.Income Statement for the year 2020 Particulars Amount ($) Sales = 2362500 Less:- Variable Cost @ 70% of Sales = (1653750) Contribution = 708750 Less:- Fixed Cost = (94000) Net Income before depreciation, interest & taxes = 614750 Less:- Depreciation = (168000) Less:- Interest @ 6% × $315000 = (18900) Net Income before taxes = 427850 Less:- Taxes @ 30% × $427850 = (128355) Net Income after taxes = 299495 Less:- Dividend @ 50% × 299495 = (149747.5) Addition to Retained Earnings = 149747.5 Working Note 1.Calculation of Fixed Assets (net of depreciation) Fixed Assets as on 2019 = 800000 Less:- Depreciation @ 20% for 2019 = (160000) Fixed Assets (Net of depreciation) = 640000 Add:- Increase on Fixed Assets = 200000 Fixed Assets (net of depreciation 2020) = 840000 Gross Fixed Assets 2020 = 1050000 (840000 ÷ 80%) 2. Net Fixed Assets at the begnning of 2020 = $840000 Depreciation for 2020 = $840000 × 20% = $168000 3. Calculation of Total Assets for 2020 Total Assets = Fixed Assets + Net Working Capital Total Assets = $1050000 + $525000 = $1575000 4. Net Working Capital for 2020 will be 50% of Fixed Assets i.e. $1050000 × 50% = $525000 5. Revenue to Total Assets = 1.5 Times 1.5 = Revenue Total Assets 1.5 = Revenue 1575000 Revenue for 2020 = $2362500 6. Book debts = 20% of Total Capital Book debts = 20% × $1575000 = $315000 7. Interest = $315000 × 6% = $18900 Balance Sheet for the year 2020 Assets Amount ($) Net Working Capital 525000 Fixed Assets 1050000 Total Assets 1575000 Liabilities & Shareholder's Equity Debt 315000 Equity 1260000 Total 1575000Balance Sheet for the year 2020 (assuming that the balancing item is debt and that no equity is to be issued. Prepare a completed pro forma balance sheet for 2020) Assets Amount ($) Net Working Capital 525000 Fixed Assets 1050000 Total Assets 1575000 Liabilities & Shareholder's Equity Debt (Balancing figure) 675000 Equity 900000 Total 1575000

Answered: Please see information attached to…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Please see information attached to answer below questions. Preferrably in Excel.

a1. Produce an income statement for 2020. Assume that net working capital will equal 50% of fixed assets.

a2. Produce a balance sheet for 2020. Assume that net working capital will equal 50% of fixed assets.

b. Now assume that the balancing item is debt and that no equity is to be issued. Prepare a completed pro forma balance sheet for 2020.

c. Assume that the balancing item is debt and that no equity is to be issued, what is the projected debt ratio for 2020?

The following tables contain financial statements for Dynastatics Corporation.
Although the company has not been growing, it now plans to expand and will
increase net fixed assets (i.e., assets net of depreciation) by $200,000 per year for
the next 4 years, and it forecasts that the ratio of revenues to total assets will
remain at 1.50. Annual depreciation is 20% of net fixed assets at the beginning of
the year. Fixed costs are expected to remain at $94 and variable costs at 70% of
revenue. The company's policy is to pay out one-half of net income as dividends
and to maintain a book debtratio of 20% of total capital.
INCOME STATEMENT 2019 (figures in thousands)
Revenue
1,800
Fixed costs
94
Variable Cost (70%) of revenue)
1,260
Depreciation
$
160
Interest (6% of beginning of year debt)
Taxable Income
18
268
Taxes (at 35%)
$
$
94
Net Income
174
Dividends
$87
Addition to retained earnings
$87
INCOME STATEMENT 2019 (figures in thousands)
Assests
Net Working Capital
Fixed Assets
400
2$
800
Total Assets
1.200
Liabilities and Shareholders equity
Debt
300
Equity
Total liabilities and shareholders equity
2$
900
1,200

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

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