Using Table 6–13, create a pro forma balance sheet using the percentage of sales method. If net income next year is $50,000, answer the following: How much did the owners take out of the business? What is the profit margin for next year?
Using Table 6–13, create a pro forma balance sheet using the percentage of sales method. If net income next year is $50,000, answer the following: How much did the owners take out of the business? What is the profit margin for next year?
Corporate Financial Accounting
14th Edition
ISBN:9781305653535
Author:Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:Carl Warren, James M. Reeve, Jonathan Duchac
Chapter14: Financial Statement Analysis
Section: Chapter Questions
Problem 14.9BE
Related questions
Question
Using Table 6–13, create a pro forma
- How much did the owners take out of the business?
- What is the profit margin for next year?
![TABLE 6–13 Pro forma Balance Sheet Using Percentage of Sales
Total Sales
Current Year
$275,000
Percentage
of Sales (%)
Forecast
Sales Net
Year $350,000
Assets
Current Assets
Cash
Accounts Receivable
Inventory
Total Current Assets
Fixed Assets
Furniture & Fixtures
$ 5,694
19,662
3,381
$28,737
5,595
25,456
$31,051
$59,788
Transporation Equipment
Total Fixed Assets
Total Assets
Liabilities and Owner's Equity
Current Liabilities
Notes Payable
Accrued Taxes Payable
Total Current Liabilites
Long Term Debt
Total Liabilities
Owner's Equity
Total Liabilities and Owner's Equity
$15,456
3,598
$19,054
18,654
$37,708
22,080
$59,788](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F98520efb-fdb3-486e-be38-7dfc109855d4%2F092a5312-5014-4b58-b0a6-4c0acd0e5ff7%2Fwq7rjpv_processed.png&w=3840&q=75)
Transcribed Image Text:TABLE 6–13 Pro forma Balance Sheet Using Percentage of Sales
Total Sales
Current Year
$275,000
Percentage
of Sales (%)
Forecast
Sales Net
Year $350,000
Assets
Current Assets
Cash
Accounts Receivable
Inventory
Total Current Assets
Fixed Assets
Furniture & Fixtures
$ 5,694
19,662
3,381
$28,737
5,595
25,456
$31,051
$59,788
Transporation Equipment
Total Fixed Assets
Total Assets
Liabilities and Owner's Equity
Current Liabilities
Notes Payable
Accrued Taxes Payable
Total Current Liabilites
Long Term Debt
Total Liabilities
Owner's Equity
Total Liabilities and Owner's Equity
$15,456
3,598
$19,054
18,654
$37,708
22,080
$59,788
Expert Solution
![](/static/compass_v2/shared-icons/check-mark.png)
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
![Corporate Financial Accounting](https://www.bartleby.com/isbn_cover_images/9781305653535/9781305653535_smallCoverImage.gif)
Corporate Financial Accounting
Accounting
ISBN:
9781305653535
Author:
Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:
Cengage Learning
![Accounting (Text Only)](https://www.bartleby.com/isbn_cover_images/9781285743615/9781285743615_smallCoverImage.gif)
Accounting (Text Only)
Accounting
ISBN:
9781285743615
Author:
Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:
Cengage Learning
![Survey of Accounting (Accounting I)](https://www.bartleby.com/isbn_cover_images/9781305961883/9781305961883_smallCoverImage.gif)
Survey of Accounting (Accounting I)
Accounting
ISBN:
9781305961883
Author:
Carl Warren
Publisher:
Cengage Learning
![Corporate Financial Accounting](https://www.bartleby.com/isbn_cover_images/9781305653535/9781305653535_smallCoverImage.gif)
Corporate Financial Accounting
Accounting
ISBN:
9781305653535
Author:
Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:
Cengage Learning
![Accounting (Text Only)](https://www.bartleby.com/isbn_cover_images/9781285743615/9781285743615_smallCoverImage.gif)
Accounting (Text Only)
Accounting
ISBN:
9781285743615
Author:
Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:
Cengage Learning
![Survey of Accounting (Accounting I)](https://www.bartleby.com/isbn_cover_images/9781305961883/9781305961883_smallCoverImage.gif)
Survey of Accounting (Accounting I)
Accounting
ISBN:
9781305961883
Author:
Carl Warren
Publisher:
Cengage Learning