Prepare the Pro Forma Statement of Financial Position as at 31 December 2025 from the information provided below. Info: The budgeted Statement of Financial Position of Candyland Ltd as at 31 December 2024 is as follows: Candyland Ltd Statement of Financial Position as at 31 December 2024 R ASSETS Non-current assets 2 500 000 Fixed/Tangible assets 2 500 000 Current assets 2 250 000 Inventory 1 500 000 Accounts receivable 625 000 Cash 125 000 Total assets 4 750 000 EQUITY AND LIABILITIES Equity 3 500 000 Ordinary share capital (150 000 shares) 3 000 000 Retained earnings 500 000 Non-current liabilities 750 000 Long-term loan: Barbie Bank 750 000 Current liabilities 500 000 Accounts payable 500 000 Total equity and liabilities 4 750 000 Candyland Ltd provided the following additional financial data to assist in the preparation of the Pro Forma Statement of Financial Position as at 31 December 2025: Sales for 2025 are estimated to be R7 500 000. All the sales will be on credit. Accounts receivable would be based on a collection period of 36.5 days. The inventory balance on 31 December 2025 is expected to be 20% greater than the balance on 31 December 2024. Vehicles that cost R1 000 000 will be purchased during 2025. Equipment with a cost price of R50 000 and accumulated depreciation of R30 000 is expected to be sold for R23 000. Total depreciation for 2025 is estimated to be R700 000. The accounts payable balance is forecasted at 15% of sales. The authorised share capital consists of 200 000 shares. Fifty percent (50%) of the unissued shares are expected to be sold at R25 each during July 2025. The business predicts a net profit margin of 7%. A final dividend of 90 cents per share is expected to be declared at the end of 2025, payable during 2026. All the shares in issue qualify for the final dividend. An amount of R150 000, including R20 000 for interest on loan, will be paid to Barbie Bank during 2026. The cash balance must be determined (balancing figure).
Prepare the Pro Forma Statement of Financial Position as at 31 December 2025 from the information provided below.
Info:
The budgeted Statement of Financial Position of Candyland Ltd as at 31 December 2024 is as follows:
|
Candyland Ltd |
|
|
Statement of Financial Position as at 31 December 2024 |
|
|
|
R |
|
ASSETS |
|
|
Non-current assets |
2 500 000 |
|
Fixed/Tangible assets |
2 500 000 |
|
Current assets |
2 250 000 |
|
Inventory |
1 500 000 |
|
Accounts receivable |
625 000 |
|
Cash |
125 000 |
|
Total assets |
4 750 000 |
|
|
|
|
EQUITY AND LIABILITIES |
|
|
Equity |
3 500 000 |
|
Ordinary share capital (150 000 shares) |
3 000 000 |
|
Retained earnings |
500 000 |
|
Non-current liabilities |
750 000 |
|
Long-term loan: Barbie Bank |
750 000 |
|
Current liabilities |
500 000 |
|
Accounts payable |
500 000 |
|
Total equity and liabilities |
4 750 000 |
|
Candyland Ltd provided the following additional financial data to assist in the preparation of the Pro Forma Statement of Financial Position as at 31 December 2025: |
|
|
Sales for 2025 are estimated to be R7 500 000. All the sales will be on credit. |
|
|
Accounts receivable would be based on a collection period of 36.5 days. |
|
|
The inventory balance on 31 December 2025 is expected to be 20% greater than the balance on 31 December 2024. |
|
|
Vehicles that cost R1 000 000 will be purchased during 2025. Equipment with a cost price of R50 000 and accumulated depreciation of R30 000 is expected to be sold for R23 000. Total depreciation for 2025 is estimated to be R700 000. |
|
|
The accounts payable balance is forecasted at 15% of sales. |
|
|
The authorised share capital consists of 200 000 shares. Fifty percent (50%) of the unissued shares are expected to be sold at R25 each during July 2025. |
|
|
The business predicts a net profit margin of 7%. |
|
|
A final dividend of 90 cents per share is expected to be declared at the end of 2025, payable during 2026. All the shares in issue qualify for the final dividend. |
|
|
An amount of R150 000, including R20 000 for interest on loan, will be paid to Barbie Bank during 2026. |
|
|
The cash balance must be determined (balancing figure). |
|
Step by step
Solved in 2 steps
