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Income Statement Huddleston Manufacturing Company For the Year Ended December 31, 2012 Sales                           

Income Statement

Huddleston Manufacturing Company

For the Year Ended December 31, 2012

Sales                                                                $2,800,000

Less: Cost of goods sold                                    1,820,000

Gross profits                                                     $   980,000

Less: Operating expenses                                       240,000

Operating Profits                                               $   740,000

Less: Interest expense                                              70,000

Net profits before taxes                                     $   670,000

Less: Taxes (40%)                                                  268,000

Net profits after taxes                                        $   402,000

Less: Cash Dividends                                             132,000

To: Retained earnings                                       $   270,000

Huddleston Manufacturing estimates its sales in 2013 will be $3 million.  Interest expense is expected to remain unchanged at $70,000, and the firm plans to pay cash dividends of $140,000 during 2013.  Cost of goods sold includes $200,000 in fixed costs, and operating expenses include $50,000 in fixed costs.  Use the percent‑of‑sales method to prepare a pro forma income statement for the year ended December 31, 2013, based on the 2012 income statement shown above.

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SEE THE IMAGE. ANY DOUBTS, FEEL FREE TO ASK. THUMBS UP PLEASE

AS NOTHING WAS MENTIONED, ALL FIGURES ARE ROUNDED TO NEAREST DOLLARS. IF NEED ANY CHANGE, LET ME KNOW, WILL DO IT.

jeff jeffy answered 5 months ago
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